south asian review of business and administrative studies vol. 4, no. 1, jun 2022 87 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas human resources practices influence on project success: case of project based construction organizations in district lahore, punjab mavia iqbal, university of lahore, pakistan rabia inayat, university of lahore, pakistan article details abstract history revised format: may 2022 available online: june 2022 keywords hrm practices, project success, construction firms, lahore-punjabpakistan this research aims to determine, hypothesize and theorize the significance of human resource management (hrm) practices towards project success and performance in the project-based construction businesses of district lahore-punjab-pakistan. the effective hrm is considered as foundation of significant and supportable competitive power and pillar for the construction organizations. it supports and leads to success of projects and business, however there is lack gap of extensive studies to fairly portray the conceptual model of hrm practices, staff and businesses and projects success relations specifically in the construction firms of district lahore. the wide-ranging research works recognized the hrm-factors and project success association. after reviewing the extant literature on hrm and performance, different conceptualization has emerged. the most important with regards to hrm practices to understand the firms succeed in its goals and objectives of project success. the primary data obtained through selfadministered questionnaire. using random sampling, a sample of 150 survey questionnaires were distributed among the employees of construction firms and 130 valid survey form were returned. the statistical treatment on data set was carried out in spss. it is concluded that the hrm practices have positive impact on success of project in the firms. this research may significantly contribute to hrm framework tend to enhance project performance in the construction sector of punjab-pakistan. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: rabiainayat2@gmail.com doi: https://doi.org/10.52461/sabas.v4i1.1044 introduction the idea and concept of ‘project-based task’ emerged since last two decades in major sectors of industries and business finances. researches proved that employees switch their careers to a flexible mode that facilitates learning from tasks, projects, and experiences. the challenges of technology evolution suggest changing the leadership role from leaders to those who can lead and lead teams, support connections and engagement, and support a culture that enhances growth, innovation, and development. these managers must be able to manage a diverse workforce, inhttps://journals.iub.edu.pk/index.php/sabas mailto:rabiainayat2@gmail.com https://doi.org/10.52461/sabas.v4i1.1044 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 88 house employees, contractors, and temporary (on-demand) (schwartz et al., 2017); schwab & samans, 2016). research on projects-based firms as temporary ventures is very rare, except that they are normal structures within an organization from an hrm perspective the impact of project-based organizations on human resources is significant. work management through the project also means fairness, ethics, and great motivation from an employment perspective. staff involved in the project become part of the job. in addition, the hr function in various leadership roles has not been considered in the literature. therefore, with the above framework in mind, we set out to consider key developments related to the relationship between hrm and project-based organizations (keegan, ringhofer, & huemann, 2018); (crawford et al., 2006); vicentini & boccardelli, 2014); (kenis et al., 2009). objective to measure and evaluate the hrm practices and factors which contribute and influence to project success of the construction firms in district lahore, punjab-pakistan? research question in what ways hrm practices and factors contribute and influence to project success of the construction firms in district lahore, punjab-pakistan? hypothesis hrm practices and factors contribute and influence statistically significantly to project success of the construction firms in district lahore, punjab-pakistan? literature review and hypothesis development hrm is defined as the intent of both explicit and secret organizations in relation to the management of people expressed through philosophy, policy and practice and numerous studies conducted by the capabilities and talents in a company is a result of hr manager`s selections for effective implementations of hr practices (tyson, 1995); (chowhan, 2016); (torrington et al., 2011); (clinton & guest, 2013); (wright & boswell, 2002). reputation of hr in firms the aim hr department in an organization to support and guide the employees to get their benefits and rights. most small businesses do not have a formal human resources department. every company has a recruitment and personnel policy, even if implicit. many important roles of hr section, as they encourage effective companies to play many roles in the hr department in today's highly competitive environment. the roles framed related to productive of organization, for better quality of the working of the organization, it is more likely to help create and improve and advantage of staff flexibility. the hr managers tend to put important roles to implement hr practices effectively. functions of hr as your business grows, you need to manage your hr capabilities. the major function includes all roles, obligations, and responsibilities from recruitment process, education and training, performance planning and evaluation, compensation and other compensation to retirement. personnel functions include not only general managers and personnel departments, but also line managers and employees themselves. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 89 recruitment and selection the hr managers and firms owners focus on the ability of applicants and organization owners, not job suitability, to increase the flexibility of the multitasking workforce at sme facilities. emphasize that. we want to succeed in the global market (holt, 1993). the issue of hr practices less addressed in the literature than the interest and importance to entrepreneurs (heneman et al., 2000). training and development according to smith (1990) the developing and improving organizational talent and employees performance is an integral part of an organization that can optimize the use of key resources to achieve a sustainable competitive advantage for business and staff performance. performance appraisal it evaluates and assesses the performance of staff. the hr practices in small businesses found that formal systems were generally rare, although half of the respondents used some form of assessment. the firms are particularly suffering because of formal procedures for managing performance evaluation, disciplinary action, or worker dismissal are rare in smes (cardon & stevens, 2004). it seems to be interesting to note that smes use formal schemes to informally evaluate employee performance. compensation and reward it is very important dimension of hr practices. if a company does not pay enough to workers then it cannot grow and survive. rewards include psychological rewards, learning opportunities, and awareness, in addition to basic salaries and monetary rewards in the form of incentives (heneman et al., 2000). conceptual framework and hypothesized model the, construction firms have been faced with a great deal of competition which increases in future. the hr managers must be focused to maximize the utilization of human resources for improving project success. the proposed model determining the association between hrm practices and project success is shown in figure. 1: figure.1: conceptual framework method population and sample the population was comprised on all those project managers who get involved in civil projects in construction companies of district lahore-punjab. the sample consisted on (130) project managers from 150 construction firms registered with pec. sample was selected using simple random technique. instrumentation on order to achieve objective of research. a questionnaire having 5-point likert-type scale was used as instrument to gather data from sample participants. the first section included as project success hrm practices staff recruitment and hiring staff training and development rewards and compensation performance evaluation staff job satisfaction south asian review of business and administrative studies vol. 4, no. 1, jun 2022 90 demographics profile of participants, followed by relevant items of hrm practices as independent variables and statements related to project success as outcome variable. procedure of data collection the primary data were collected only through distributing of questionnaires. the researcher gathered the responses through personally visit to every participant. a total of 150 questionnaires were distributed and 130 valid and fully filled forms were returned with informed consent and voluntarily. the response return rate was 87%. validity and reliability the instrument was validated through experts of opinions. some of items were modified and a few were excluded based on experts’ suggestions. the check the reliability consistency and stability of instrument, the cronbach’s alpha test was used to meet the acceptable level (α > .70. results of data analyses table 4.1 descriptive statistics hrm practices/factors mean std. deviation level of influence rsh 3.23 .398 medium std 3.18 .358 medium rc 3.35 .369 medium pa 3.42 .365 medium sjs 3.40 .516 medium average/total 3.32 .401 medium table 4.1 showed that the participants perceived arithmetic average score ranged from 3.18 to 3.42) as compared to mean value of scale (3) and overall mean of (3.32, sd=.401) reflects positive attitude towards hrm practices which influence on project success. the most influential hrm practice is “performance appraisal & evaluation” (3.42, sd=.365) followed by staff job satisfaction factor (3.40, sd=.516) and employee rewards & compensation (3.35, sd=.369) respectively. it expressed that the hrm managers must consider meaningfully on these three aspects of hrm. while the least influential factor is staff training and development (3.18, sd=.358) followed by staff recruitment and selection (3.23, sd= .398). this indicates that the hrm managers need to raise the awareness about staff training & development and recruitment process. table 4.2 simple regression analysis model summary model r r2 f-calc. std. β coeff. t-calc.(sig.) result/decision pa ps .524 .275 48.470*** .524 6.962*** accepted sjs ps .403 .163 24.853*** .403 4.985*** accepted rc ps .326 .107 15.263*** .326 3.907*** accepted rs ps .268 .072 9.874*** .268 3.142*** accepted std ps .289 .083 11.646*** .289 3.413*** accepted note: *** sig. <.001 table 4.2 revealed that the calculated t-value is statistically significant at α <.001 indicating that performance appraisal (pa) practice of hrm has significant impact and influence on project success (ps) in construction firms. the coefficient r-value = .524 illustrates a positive significant south asian review of business and administrative studies vol. 4, no. 1, jun 2022 91 association between variables. the coefficient of determination r2-value = .275 indicates that 27.5% variance in project success may be contributed and intercepted through performance appraisal factor. while the remaining percentage or proportion is credited by other variables which are hidden in the regression model. it is exposed that the calculated t-value is statistically significant at α <.001 indicating that staff job satisfaction (sjs) practice of hrm has significant impact and influence on project success (ps) in construction firms. the coefficient r-value = .403 explains a positive significant relationship between variables. the coefficient of determination r2value = .163 indicates that 16.3% variance in project success may be contributed and intercepted through staff job satisfaction (sjs) factor. while the remaining percentage or proportion is credited by other variables which are hidden in the regression model. table 4.2 discovered that the calculated t-value is statistically significant at α <.001 indicating that rewards & compensation (rc) practice of hrm has significant impact and influence on project success (ps) in construction firms. the coefficient r-value = .326 demonstrates a positive significant association between variables. the coefficient of determination r2-value = .107 indicates that 10.7% variance in project success may be contributed and intercepted through rewards & compensation factor. while the remaining percentage or proportion is credited by other variables which are hidden in the regression model. table 4.2 indicated that the calculated t-value is statistically significant at α <.001 indicating that recruitment and selection (rs) practice of hrm has significant impact and influence on project success (ps) in construction firms. the coefficient r-value = .268 illustrates a positive significant association between variables. the coefficient of determination r2-value = .072 indicates that 7.2% variance in project success may be contributed and intercepted through recruitment and selection factor. while the remaining percentage or proportion is credited by other variables which are hidden in the regression model. table 4.2 revealed that the calculated t-value is statistically significant at α <.001 indicating that staff training & development (std) practice of hrm has significant impact and influence on project success (ps) in construction firms. the coefficient rvalue = .289 illustrates a positive significant association between variables. the coefficient of determination r2-value = .083 indicates that 8.3% variance in project success may be contributed and intercepted through staff training & development factor. while the remaining percentage or proportion is credited by other variables which are hidden in the regression model. findings and discussion the purpose of study was to investigate influential hrm factors affect on the success of project in in construction firms of district lahore. the participants perceived average extent of performance appraisal was (3.42) indicated the influence and effect of performance evaluation on projects success is medium in the construction firms of district lahore. this finding matches with the study (kotey and slade, 2005). it indicates that the firms have fair appraisal performance system to hold the staff dedication and to support success of project. furthermore, the perceived average magnitude of staff job satisfaction was (3.40) indicated the outcome and effect on projects success is medium in the construction firms of district lahore. this finding relates with the study (cardon & stevens, 2004). it specifies that the firms have satisfactory staff job satisfaction system to arrange the staff satisfaction and to support success of project. moreover, the perceived average degree of rewards & compensation was (3.35) indicated the impact and effect on projects success is medium in the construction firms of district lahore. this finding relates with the finding of south asian review of business and administrative studies vol. 4, no. 1, jun 2022 92 (heneman et al., 2000). it shows the firms have competitive rewards, and compensation system to attract the staff commitment and enthusiasm and to support success of project. conclusion this research paper aim to determine the influence and effect of hrm practices on success of project in construction firms of district lahore, punjab-pakistan. the result revealed that there is significant effect of hrm practices on projects success in construction companies. these factors support to construction organizations for success of project through hrm factors including effective performance appraisal, staff job satisfaction and competitive rewards and compensation. recommendations and suggestions based on results, the management and administration may be focused on effective hrm system which is foundation of project success and business success. furthermore, it is also recommended that the computerized hrm information system may be introduced in construction industries for quick and rapid reporting and decision making. limitation and future research directions in this study only 130 construction firms included registered with pakistan engineering council (pec). this research conducted on construction firms in district lahore of central-punjab, pakistan. the findings of this research cannot be generalized of all firms of province punjab, because of different factors. furthermore, in current research, only five hrm practices have been focused using regression analyses, but in future we will add more independent variables and mediation variables and large sample size and other large cities of central punjab-pakistan. acknowledgements this research work was funded and supported by the central institute of management sciences (cims) through grant reference no. cims-res-2021-015. any opinion, findings, conclusions, and recommendations articulated by authors(s) in this manuscript, do not necessarily reflect the views and opinions of cims. references bredin, k., & söderlund, j. 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(1994). human resources and sustained competitive advantage: a resource-based perspective. international journal of human resource management, 5(2), 301-326. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 94 south asian review of business and administrative studies vol. 1, no. 1, june 2019 33 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.1, june 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas the need for efficient record management system in pakistan qurat ul ain, national college of business administration and economics, pakistan article details abstract history revised format: may 2019 available online: june 2019 keywords record management, poverty alleviation, taxation the united nations millennium declaration, marked in september 2000, calls for world pioneers to battle poverty, hunger, lack of education, environmental degradation, and discrimination against women. poverty is one of the many dire issues developing countries encounter. poverty reduction is usually attributed to economic development because it offers economic freedom. economic freedom can only be realized through financial inclusion. financial inclusion implies that people and organizations have access to valuable and moderate monetary facilities such as access to bank mortgages insurance and other financial issues that address exchanges, installments, reserve funds, credit and protection – delivered in a responsible and sustainable manner. accurate record management is the foundation for financial inclusion. pakistan is a developing country graveling with poverty. a major cause for the lack of successful poverty elevation initiatives is the improper and incomplete record management. the goal of records management is to help an organization keep the necessary documentation accessible for both business operations and compliance audits. in addition, records management provides institutional accountability and timely access to information because in developing country context improper record management of its citizen is a major hindrance in achieving the concept of welfare economy in letter and spirit. an expository theoretical research is used to postulate the problem of record management. the purpose of this study is to highlight the problem of record management in pakistan. proper record management systems allow for accurate, and transparent zakat management systems and taxation systems. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: qurat.ul.ain_mumtaz22@hotmail.com doi: https://doi.org/10.52461/sabas.v1i1.447 introduction records, as defined in international standards, are any “information created, received, and maintained as evidence and as an asset by an organization or person, in pursuit of legal obligations or in the transaction of business.” when we think about the record management https://journals.iub.edu.pk/index.php/sabas mailto:qurat.ul.ain_mumtaz22@hotmail.com https://doi.org/10.52461/sabas.v1i1.447 south asian review of business and administrative studies vol. 1, no. 1, june 2019 34 our first reaction is to think about it within the borders of the country. pakistan is a developing country, facing lots of challenges in terms of record management. the biggest challenge for pakistan is to achieve the united nations millennium declaration goals. poverty is one of the unmc goals. to reduce poverty economic growth plays an important role in it. .according to the department for international department (dfid), for developing countries economic growth plays a vital role to reduce poverty. there is a number of evidence illustrating that fast and sustainable growth makes effective and efficient progress towards the mdg. the achievement towards reducing the poverty level gets one step ahead toward an inclusive economy. inclusive economy addressing all the fundamental causes instead of addressing those negative effect of the economic growth outcomes (burch & mcinroy, 2018). inclusive economy agenda is conceptually strong, action focused and has alignment to heterodox economics and new forms of economic democracy and urban development such as new municipalism (calafati & mcinroy, 2017). financial inclusion is one of the instruments to achieve the agenda of inclusive economy. financial inclusion implies that people and organizations have access to valuable and moderate monetary facilities such as access to bank mortgages insurance and other financial issues that address exchanges, installments, reserve funds, credit and protection – delivered in a responsible and sustainable manner. according to the world bank financial inclusion is one of the effective and efficient things that reduce poverty and help to boost shared prosperity and as well as take a forward step to achieve universal financial access 2020 ambitious global goals . from 2010 to till now, more than 55 countries adopted financial inclusion. more than 60 countries are developing the national wide strategy toward achieving financial inclusion. the launching of financial inclusion strategic approach brings together all the institutes. they get inter-linked by financial regulators, telecommunications, competition and education ministries. this will help us to increase the pace and impacts or reforms (the world bank, 2018). in the early 20’s there were unstructured records produced in all institutions of pakistan. till now there are some institutions subject to the same record keeping regulation as traditional paper records that are unacceptable in this era because of new technologies. this is necessary for the developing countries to keep their record according to advanced systems of record management. in pakistan record management is one of the issues that still exist. due to an inefficient record management system, pakistan is unable to collect the information about the pakistani’s citizens. there is no proper record of pakistani’s citizen. so that’s why, we are unable to calculate the taxes of pakistani individuals. pakistan is lacking to achieve the allinclusive economy goal. literature review record management in the international standard of record, records are defined as any “information created, received, and maintained as evidence and as an asset by an organization or person, in pursuit of legal obligations or in the transaction of business”. information can be in any form but for the institutions it is important to link them together and make or get useful information for further use. it is necessary to record the data in a proper form or format. this will be helpful for the institution to understand or get the useful information. transparency and accountability of data are most systematic issues in managing the records. south asian review of business and administrative studies vol. 1, no. 1, june 2019 35 proper recorded data will be useful for a long period of time. for this institutes, they take care about the accuracy, accessibility, reliability, usefulness and authenticity of the data. reliable and accessible records base is very important for the characteristics for e-governance, especially the right to get the open data based on the ability to get access to the consistent records. managing the records will not itself get openness, although devoid of, openness is not possible (phiri, 2016). the accuracy of data records will provide clear and strong pictures of the government that what they had promised. what they are actually doing, what kind of facilities they had promised us to provide and what they are actually provided and the real amount; they had spent to public funds. if record maintenance is weak that will cause a problem of corruption, manipulation, frauds and money laundering. the record must have that quality which shows policies, practices, structure, skills of handling the data, laws and developed the professional association between data as per international standard of record management (phiri, 2016). data or information can be recorded in different forms, but the transparency and accountability are the basic agenda of the record management system. openness is one of the techniques to record the data, so that it will be easily accessible to any financial institutes. openness is helpful to increase the transparency and accountability of data. by increasing transparency and accountability will help in reducing the public sector corruption frauds and manipulation, and increase economic performance, and people will have the right to get acquainted with how their governments are working, what they are doing and what are the benefits from accessing the government information or data. through openness data or records will achieve different goals like inclusive government economy, information is available for every citizen and all information is meaningful (katuu, 2015). for the development of the countries managing the record and data, quality of data or information is an important source. this data will be very effective for making it useful and authenticated. the effective information and data offer a helpful approach to the means of matching the international expectation. moreover, it will also help to keep up openness and economic growth (katuu, 2015). through openness in data or records, it will be helpful in the social rights and standard that every citizen, as well as the poor citizen of a society, is having an equal liberty to get access to service, especially health education and social justice. the transparency and accountability of records highlight interoperability solutions to the public sector and for sharing, collaborating and reusing the data or records of telling different strategy planning. this will help to achieve the long terms plans. the inefficient record management and its sharing with information system lead to ineffectiveness of record resources (thurston, 2015). the nordic countries are using advanced technologies to manage the record, its reliability and its uses. institutions should take it for granted of the authenticity, credibility and integration of the data. this will be insured in public sector offices, that information could be useful by arranging, observing the programs, and their office related activities. by getting useful or accurate data, institutes get the quick trace of discrepancy, check and balance in policy decision makings perfectly over time to time as a basis of information (chaterera, 2016). south asian review of business and administrative studies vol. 1, no. 1, june 2019 36 in audit, transparency and accountability helps to find the changes and illegitimate use of records and point out corruption. the privacy right of the records could be protected and systematic records could be opened to the public (chaterera, 2016). we can use software and hardware formats to transfer files from one place to another. by managing the accountability and transparency records standardized interoperability rules could be worked more effectively and efficiently, makes it possible to combine discrete information systems, such as document management systems, accounting, and finance systems particular to the activities of an organization and to reuse the information and data. through managing the records accurately, fear of losing information will be minimized (thurston, 2015). the understanding of the value information increases proper documentation of data. it will also be supportive in decision-making policies, services and helpful in research planning as well as public use. this is the appreciation that data is improving and useful. both better quality records and most efficient and effective use of records are the forms of information involved in management principles. most of the records have been lost due to data is not protected and preserved in public sector so cannot be transferred or exchanged and reused effectively. if data is protected and preserved in the public sector, then, the duration of time is too short. so, there must be an e-governance in the economy to understand the ability to use and preserve the data or records of many decades. accurate records do not fulfill the transparency and accountability need but updating the records is also necessary for them (chaterera, 2016). there are a few generally acceptable record keeping principles used all over the world for recording the data. it will help us to understand the high level overview of the principles of information governance. like aram international (it is a world-leading membership company that serves professionals, managing and governing the information or data), the records principles are set according to the characteristics of an effective and efficient information governance system. yet, there is also some flexibility in it based upon the exceptional or different conditions of the organization size, legal environment right to information managing records and information for transparent, accountable, and inclusive governance in the digital environment: lessons from nordic countries and their resources. the data or information must be record of these following principles (thurston, 2015). principle of accountability delegate responsibility for records and information management to appropriate individuals. principle of integrity information generated by or managed for the organization has a reasonable and suitable guarantee of authenticity and reliability. some other principles from nordic countries principle of protection ensure a reasonable level of protection for records and information that are private, confidential, privileged, secret, classified, or essential to business continuity. principle of compliance comply with applicable laws and other binding authorities, as well as with the organization’s policies. south asian review of business and administrative studies vol. 1, no. 1, june 2019 37 principle of availability information in a manner that ensures timely, efficient, and accurate retrieval of needed information. principle of retention for an appropriate time, taking into account its legal, regulatory, fiscal, operational, and historical requirements. principle of disposition secure and appropriate disposition for records and information. principle of transparency document in an open and verifiable manner, and that documentation shall be available to the individuals. through the application of e-governance, everyone can access the official information or public sector records as a proof of policies, precedents, expenditure, action, transactions, rights and entitlements. latest studies by the world bank reflect on both the opportunities and the challenges associated with the management of records for e-governance in norway, finland and estonia (thurston, 2015). three nordic countries are different from their highly respected commitments to openness and social justice, lower corruption rates and their advanced technologies that sustain economic development and highly increase quality consumer service providers (thurston, 2015). taxation system and poverty in pakistan pakistan is among the countries which are still based on paper based system and have not made a shift to the digitisation of records, however, it is taking steps to digitise its records and systems. nevertheless, the government has not realised the true potential of the digitised record management systems. digitised record management systems would make governments more open. since 1947, there is no proper record management system available, that records the information or data of pakistani citizens. pakistan is a developing country; its gdp ratio is less than other developing countries. pakistan taxation system is not effective and efficient. every pakistani citizen is not a taxpayer because of hiding their property from fbr. tax collection is one of the hurdles for pakistan’s economic system and this inefficient taxation system is pointing out again and again with the passage of time. collection of revenue is the basic issue for pakistan (khan, 2017). the most genuine concern for pakistan is the taxation system. recently, the inquiry raises the point that, why pakistani citizens evade tax? what could be the conceivable reasons separated from the way that individuals come up short on the awareness of the other's expectations? do people think those taxation departments not cover the government obligation and liabilities against taxes? according to the economic study detail, just 1.21. million citizens make good on pay income. tax-making it less than 1% of all the population. but as indicated by the state bank of pakistan's yearly report, 57.5 million individuals are employed and clearly are earning some salary and in this way 57.5 million individuals ought to make good on pay income tax in one way or another. in addition, pakistan's complete population is around 200 million. as indicated by the normal thought, 29% of the populace is covering the regulatory expenses. according to the economic study of pakistan, 61.4% population is of working age south asian review of business and administrative studies vol. 1, no. 1, june 2019 38 making 122 million individuals fall into the working population. the 57.5 million citizens establish 48% of these working individuals (khan, 2017). policy-makers and the government should have to meet the goals that will help to reduce the poverty level and improve the lifestyle of their poorest citizens. they also have to find a realistic model or methods that will be helpful for the government to redesign taxation and transfer the amount to the most extremely needy person of our societies. not only transferring the money to needy persons also gets the maximum benefits from this. in recent decades, we find out the impact on fiscal policy on inequality of income, by revealing the direct taxes, direct transfer etc. in other words our cash portion from the monetary value uses like education and health by separating the cash portion of the fiscal system showed the positive impact on reducing inequality. this will help the pakistan economy so that every moderate poor will be the net taxpayer into fiscal system like sri lanka (inchauste & lustig, 2017). there is a fundamental lesson for the policy maker from the debates that governments should take a step to design or redesign taxation and transfer system. this will be helpful for the poor and their incomes (or consumption) after taxes and before fiscal involvement, transfers will not be lower than their incomes (or consumption). by doing this, fiscal policy will improve the welfare of the least off, instead of pushing them into the poverty line (inchauste & lustig, 2017). the taxation system helps the country’s government directly and indirectly to reduce the level of poverty by simply the redistribution of income, proper record and documentation of every citizen through the citizens’ computerized national identity card (cnic) and helping in establishing the supportive fiscal social agreement in poor countries. in this process, the developing countries that are facing the same issue can play a vital role in it (moore & schneider, 2004). in the last decades of the financial era, international financial institution played a vital role in tax policy reform in south asia. this is a useful contribution to have a positive influence; most importantly if they still remain involved in the developing countries and these countries are willing to engage themselves by allowing and encouraging the opening up of the taxes and fiscal policy issues to broad democratic debates (moore & schneider, 2004). figure 1 presents the proposed efficient record management system. conclusion pakistan is a developing country and facing difficulty to achieve the mng’s like decrease the level of corruption and reduces the level of poverty. to achieve the mng’s, pakistan has to increase its economic growth. financial inclusion is one of the parts of all inclusive economy. pakistan has to improve its economy through financial inclusion. as we know, pakistan has inefficient record management system. there are institutions existing in pakistan that are managing the record of every citizen but unfortunately these institutes are not working efficiently or effectively. to manage the record, pakistan should work on e–governance i.e. drm (digital record management) and edrm (electronic digital record management). all type of data will be recorded according to iso (international organization for standardization) like nordic countries (thurston, 2015). there should be the centralized system where institutes are interrelated to each other and there is openness system i.e. every institute gets access to information or data from the other institutions. in other words there should be the south asian review of business and administrative studies vol. 1, no. 1, june 2019 39 centralized hubs to all data and information are shared over there. pakistan should have to access the record through computerized national identity card (cnic). by getting the record of every citizen; pakistan will improve the taxation system. by efficiency and effectiveness of the taxation system, it will lead to reduce the proportion of poverty, improve the income distribution and level of inequality. this will be one of the steps toward economic development. implication the government of pakistan must work on record collection of for pakistani citizens through egovernance i.e. drm (digital record management) and edrm (electronic digital record management) like nordic countries, so that records are easily accessible to all the government institutions of pakistan. references the world bank (2018). financial inclusion: financial inclusion is a key enabler to reducing poverty and boosting prosperity. the world bank. https://www.worldbank.org/en/topic/ financialinclusion/overview burch, d., & mcinroy, n. (2018). we need an inclusive economy not inclusive growth. centre for local economic strategies (cles). uk. https://cles.org.uk/wpcontent/uploads/2018/12/ policy-provocation_we-need-an-inclusive-economy-notinclusive-growth_191218.pdf calafati, l., & mcinroy, n. (2017). local government & the commons: the time has come. centre for local economic strategies (cles). https://cles.org.uk/blog/localgovernment-the-commonsthe-time-has-come/ chaterera, f. (2016). managing public records in zimbabwe: the road to good governance, accountability, transparency and effective service delivery. journal of the south african society of archivists. 49. 116-136. https://www.ajol.info/index.php/jsasa/article/view/138461 inchauste, g., & lustig, n. (2017). how do taxes and transfers impact poverty and inequality in developing countries?, the world bank. https://blogs.worldbank.org/developmenttalk/howdo-taxes-and-transfers-impactpoverty-and-inequality-developing-countries katuu, s. (2015). managing records in south africa’s public sector – a review of literature. journal of the south african society of archivists. 48. 1-13. https://www.ajol.info/index.php/jsasa/article/ view/129259 khan, s. a. (2017). the tax problem of pakistan. the nation. https://nation.com.pk/02-oct2017/ pakistanis-do-not-evade-tax moore, m., & schneider, a. (2004). taxation, governance and poverty: where do the middle income countries fit? ids working paper 230. https://www.internationalbudget.org/wp-content/ uploads/taxation-governance-andpoverty-where-do-middle-income-countries-fit-in.pdf phiri, m. j. (2016). managing university records and documents in the world of governance, audit and risk: case studies from south africa and malawi. phd thesis. http://theses.gla.ac.uk/ 7506/1/2015phiriphd.pdf thurston, a., (2015). right to information managing records and information for transparent, accountable, and inclusive governance in the digital environment: lessons from nordic countries. the world bank . usa: washington dc. http://www.irmt.org/wp2/wp-content/ uploads/2015/07/right-to-information-lessonsfrom-nordic-countries.pdf http://www.worldbank.org/en/topic/ http://www.ajol.info/index.php/jsasa/article/view/138461 http://www.ajol.info/index.php/jsasa/article/ http://www.internationalbudget.org/wp-content/ http://theses.gla.ac.uk/ http://www.irmt.org/wp2/wp-content/ south asian review of business and administrative studies vol. 1, no. 1, june 2019 40 microsoft word sabas, v4 i2 p1.docx south asian review of business and administrative studies vol. 4, no. 2, dec 2022 95 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas when knowledge workers suffer: how affective commitment and sexual harassment from pupil on educators tie with burnout muhammad asif zaheer, university institute of management sciences, pmas-arid agriculture university, rawalpindi, pakistan shuja ilyas chaudhary, university institute of management sciences, pmas-arid agriculture university, rawalpindi, pakistan zoia khan, university institute of management sciences, pmas-arid agriculture university, rawalpindi, pakistan kaleem ullah, university institute of management sciences, pmas-arid agriculture university, rawalpindi, pakistan article details abstract history revised format: nov 2022 available online: dec 2022 keywords pupil-on-knowledge worker sexual harassment, burnout, affective commitment knowledge workers are raising concerns about students harassing them with dirty jokes, provocative glances, and other forms of inappropriate behavior. because of this, the current research analyzed how sexual harassment by students affects teachers' exhaustion. using a sample of 269 female knowledge workers from an educational institutions located in rawalpindi and islamabad, the capital of pakistan. according to the data, educators who are subjected to sexual harassment from their pupils are more likely to experience burnout and affective commitment negatively influence burnout. the research has some limitations, but it does contribute to theorizing in many important ways. it offers useful suggestions to university administration that can be used to curb sexually offensive student behavior and protect against teacher burnout and work withdrawal among those who have been the victims of such behavior. © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: dr.asif@uaar.edu.pk doi: https://doi.org/10.52461/sabas.v4i2.1512 introduction knowledge workers, who are generally held in high esteem, have recently raised concerns about disrespect, maltreatment, and abuse in the classroom. there have been reports of this kind for decades, but schools have generally ignored them or the teachers involved have been too ashamed to speak up. however, situations are increasingly highlighted and frequently gain considerable coverage due to the rising use and impact of social media. as a result, academics now pay particular attention to how classroom conditions affect teachers' health and happiness (alat, 2015; king & piotrowski, 2015; fogelgarn, burns, & billett, 2019). workplace abuse in academia, which develops and breeds conflict and disagreement between professors and students, is now generally acknowledged to have negative consequences on teachers' psychosomatic wellbeing, job south asian review of business and administrative studies vol. 4, no. 2, dec 2022 96 satisfaction, and work and career commitment (robinson, 2000; thompson, 2009; makura & zireva, 2013; kim & lee, 2014). hostility, physical violence, bullying, aggression, and sexual harassment are all forms of mistreatment that frequently occur in schools (fogelgarn, burns, & billett, 2019; o'mochain, 2019). literature review and hypotheses development the primary concept of affective events theory is that employees in the service sector respond to situations and events in the workplace with emotional reactions that shape their actions and perspectives on the job. according to the notion, people's subsequent actions, perspectives, and emotional states at work are all formed by their early reactions to work events. in addition, according to affective events theory, the characteristics of the workplace can have a role in shaping occupational incidents (cropanzano & dasborough, 2015; cropanzano, dasborough & weiss, 2017). pupil-on-knowledge worker sexual harassment and burnout the pervasive problem of sexual harassment by students against professors is exacerbated by the fact that such behaviour occurs frequently in schools. catcalling, vulgar comments, unwanted touching, flirtation, and requests for sexual favors are all examples of activity that could be considered sexual harassment (alat, 2015; fogelgarn, burns & billett, 2019). research shows that instructors who are subjected to persistent sexual harassment from their pupils are more likely to have mental health problems like depression, fatigue, and apathy in the workplace (ferfolja, 2010; robinson, 2012; anderman et al., 2018). hobfoll's (2011) resource conservation theory explains why and how sexual harassment by students against teachers causes burnout. the term "burnout" refers to a state in which a person's mental and physical reserves have been depleted as a result of persistent stress brought on by an excessive amount of work (schaufeli, leiter, & maslach, 2009). according to the theory, people make firm decisions to build and keep certain capacities, such as social networks, emotional resilience, and motor skills, especially in the workplace. these items have intrinsic value or can be traded for something else of equal or greater value (hobfoll, et al., 2018). most people have finite coping mechanisms, and pressures like sexual harassment quickly deplete them. when the stores are depleted to a certain point, the individuals in question are said to have hit burnout (hobfoll & freedy, 2017). proponents of the hypothesis stress that incidents of student-on-teacher sexual harassment can drain a teacher's mental, emotional, and even physical reserves. whether or not resources are depleted as a result of sexual harassment committed by students depends on the teacher's reaction and the availability of means to restore such resources. deficiency of resources is an important consideration in studies of burnout (schaufeli, leiter, & maslach, 2009; hoboll, 2011). h1: pupil-perpetrated sexual harassment is positively related with teachers’ burnout. affective commitment and burnout according to research by irving and coleman (2003), high-affective-commitment workers feel higher stress on the job when their organizational identities are threatened by their roles. higheraffective-commitment individuals see themselves as part of the organization and work hard to attain and preserve their organizational identities by characterizing themselves in the same ways that the organization characterizes itself (burke, 1991; tajfel & turner, 1986). the term "affective commitment" describes the degree to which workers feel a sense of belonging, pride, and responsibility toward their workplace (allen & meyer, 1996). south asian review of business and administrative studies vol. 4, no. 2, dec 2022 97 workers who feel emotionally connected to their jobs are more likely to adopt the company's beliefs and priorities as their own (mayer & schoorman, 1992). reilly (1994) observed that when a stressful event diverted nurses' attention away from their professional goals, they experienced more emotional weariness. affective commitment has been shown to have positive main effects on a number of personal and professional outcomes for employees (meyer et al., 2002), but some research suggests that it may amplify the positive relationships between stressors and strain outcomes because more committed employees are more invested in and identified with organizations, making them more susceptible to stressor experiences (e.g., irving & coleman, 2003; mathieu & zajac, 1990; meyer & maltin, 2010). researchers kabat-farr et al. (2016) discovered that high-commitment persons were more likely to experience unpleasant emotions like guilt when exposed to incivility in the workplace. h2: affective commitment is negatively related with teachers’ burnout. research methodology since women are disproportionately affected by sexual harassment and assault in academia, a computer-based survey was conducted recently among female faculty members at educational institutions located in rawalpindi and islamabad, the capital of pakistan. confidentiality was ensured by not requesting their names or the names of their institutions. several female knowledge workers took part in the study by completing an online questionnaire. sample of 269 female knowledge workers are used to identify the consequences of pupil-on-knowledge worker sexual harassment and affective commitment on burnout. since the study's intended participants were professors at elite universities, an english survey based on a five-point likert scale was developed (asada et al., 2020; junoh et al., 2019; basheer et al., 2019a;muneer et al., 2019; basheer et al., 2019b; basheer et al., 2018). to avoid overwhelming busy teachers during the busiest time of the semester, we kept it brief. four questions were modified based on the research of mckinney (1990) to measure sexual harassment committed by students. four items were modified from the copenhagen burnout inventory developed by kristensen et al. (2005) were modified to assess burnout symptoms. meyer, allen, and smith (1993) developed a 6-item scale to assess individuals' level of affective commitment. data analysis the private university teaching workforce, in particular, is hamstrung by a lack of options and forced to accept poor working conditions in order to keep their jobs. we chose to survey educational institutions located in rawalpindi and islamabad, the capital of pakistan. there were 269 participants in the analysis; all participants were women, from qualification point of view 26% were graduates and 74% were postgraduates. in addition, 13.8% of participants had experience between 1 and 4 years, 24.9% had experience between 5 and 8 years, 32.7% had experience of less than 1 year, and only 28.6% had experience of 8 years or more. the majority of workers (49.8%) were between the ages of 26 and 40; the next largest group (3.5%) were those aged 25 or younger; and the smallest group (46.7%) were those aged 40 and older. table 1. descriptive statistics, reliability and correlation analysis variables mean s.d p_kw_sh ac bo p_kw_sh 2.4545 0.90269 (0.761) ac 2.5607 1.023374 (0.150)* (0.923) bo 2.5288 0.91518 0.264** 0.011 (0.803) where n = 269, p_kw_sh = pupil-on-knowledge worker sexual harassment, ac = affective commitment, bo = burnout. **p < 0.01 and *p < 0.05 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 98 results and discussion analyses were conducted using structural equation modeling (sem) (raoof et al., 2021; abdulmuhsin et al., 2021; hameed et al., 2021; yan et al., 2020; nuseir et al., 2020), and instrument validity was checked using confirmatory factor analysis (cfa). sexually harassing and exploiting students by teachers is a horrible moment that has been going on for a long time. but the way power works in academia has changed a lot over the years. students used to be the most common people who were harassed, but now students are the ones who harass teachers by giving them dirty jokes, dirty looks, cat calls, and other things. in light of this troubling problem, the goal of this study was to find out how sexual harassment by students and burnout affect each other. figure 1. sem model in model fitness indexes, χ2/ df = 2.812, agfi = 0.864, tli = 0.924, cfi = 0.938, gfi = 0.904 and rmsea = 0.082. specifically, hypothesis 1 which claimed that pupil-perpetrated sexual harassment is positively related with teachers’ burnout was confirmed. similarly, hypothesis 2 which claimed that affective commitment is negatively related with teachers’ burnout which is also confirmed. table 2. direct effects path coefficient se p_kw_sh à bo .281*** 0.076 ac à bo 0.058 0.049 conclusion when we talk about sexual harassment in schools, we usually talk about male teachers who touch students inappropriately, ask them for favors that aren't appropriate, or make rude comments about them. what we don't talk about, at least in pakistan, is how students sexually harass female teachers. this study looks into the relationship between student-on-teacher sexual harassment and teacher burnout. this is a controversial topic that is rarely talked about. its results show that teacher pupil-on-knowledge worker sexual harassment have significantly positively effect on burnout and affective commitment have negatively effect on burnout. taking this into account, academic south asian review of business and administrative studies vol. 4, no. 2, dec 2022 99 institutions should handle teachers' feelings about sexual harassment and burnout in a sensitive way to improve not only their job satisfaction and teaching skills, but also their commitment to the job and the teaching profession as a whole. references abdulmuhsin, a. a., abdullah, h. a., & basheer, m. f. 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(2020). role of psychological factors in employee well-being and employee performance: an empirical evidence from pakistan. revista argentina de clínica psicológica, 29(5), 638. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 102 south asian review of business and administrative studies vol. 5, no. 1, june 2023 63 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas foundation of corporate social responsibility and innovation for achieving competitive advantage muhammad gulraiz, university of the punjab, pakistan dr. rab nawaz lodhi, university of the punjab, pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords corporate social responsibility, bibliometric analysis, frugal innovation, competitive advantage the modern business environment requires organizations to constantly look for ways to gain a competitive advantage. this study bibliometrically describes and depicts the knowledge about corporate social responsibility and innovations as a source of competitive advantage. we have extracted the 428 articles from wos database during 2009 to 2023. this study applied a two stage bibliometric approach to analyze the sampled articles. in the first stage, the selection of the keywords: “corporate social responsibility” or “frugal innovation” or “disruptive innovation” and “competitive advantage” being used in the search bar of wos database. in the second stage, vosviewer software was used on the data file extracted from the wos database for bibliometric analysis techniques. the findings enabled us to identify how different regions of the globe that have contributed most significantly to the expansion of this field of knowledge as well as the most significant authors, articles and journals. current study has some limitations like documents were extracted from only one database e.g. wos and this study ignored the other sources like scopus and google scholar. the findings have implications for research scholars, practitioners and policy makers for in-depth knowledge of the current study indicators. this research further provides future trends in the development of csr knowledge. the originality of the paper contributes to the knowledge of bibliometric approach to disseminate trends in csr as most relevant source of competitive advantage from the wos database. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: gulraiz907@gmail.com doi: 10.52461/sabas.v5i1.1811 introduction corporate social responsibility (csr) is an essential concept in contemporary business, reflecting the increasing awareness of companies of their social and environmental responsibilities (abbas & dogan, 2022). the utmost goal of every organization is to increase customer trust and gain competitive edge (hang et al, 2022). companies are introducing new research directions that combine csr and innovation in an effort to sustain their competitive position in global economy (nyuur et al., 2019). as a result, there has been a significant increase in the literature on csr. the reason is that the innovation is not just focused by the progress of new knowledge and skills, but https://journals.iub.edu.pk/index.php/sabas mailto:gulraiz907@gmail.com south asian review of business and administrative studies vol. 5, no. 1, june 2023 64 also by the increasing worlds’ emphasis on csr issues. companies must now take into account the social and environmental impacts of their operations, foster employee creativity, work with suppliers, customers, and other partners to develop novel products and services that integrate csr, innovation, and competitive advantage in order to succeed and foster innovation. reputation and performance of firms is improved by taking various measures to cater customers’ consciousness, environment, and market competition (lewin et al., 2020). as a result of their ability to provide value for their commercial competitiveness while also having a beneficial influence on society and the environment, firms must integrate csr and innovation if they want to succeed in the contemporary worldwide economy. business success depends heavily on innovation because it forces organizations to customize their goods and services in novel ways that provide them a distinct advantage over rivals. there has been upward interest in the connotation among csr, innovation, and competitive advantage. however, research on the relationship among these three concepts is still needed. this paper aims to conduct a bibliometric analysis of the literature on csr, innovation, and competitive advantage to find out new trends, gaps, and future directions and to provide a comprehensive summary of the current research on the incorporation of csr, innovation and competitive advantage. the paper will also create a visual map to present an overall pattern of research in this field, helping researchers to understand the current development trend, and the predicted future trail. to achieve this goal, the paper addressed the following research questions (rqs): i. what are the publications by year in csr, innovation and competitive advantage? ii. what are the most frequently cited articles, frequently occurred keywords, top authors, top countries and collaborations in csr, innovation and competitive advantage? iii. what are the implications and future directions for csr, innovation and competitive advantage? methods current study has performed bibliometric techniques of the extant literature on csr, innovation, and competitive advantage extracted using the wos database. the reasons to use bibliometric analysis are twofold; first, a large amount of data over a period of time can be analyzed with bibliometric analysis and it uses the mathematical, statistical and graphical tools (song & wang, 2020). second, it also offers novel research ideas to researchers working on core literature around the world (sedita et al., 2020). data collection for this study the researchers extracted the articles which were published in web of science database between 2009 and 2023 that included the terms "corporate social responsibility," "disruptive innovation,", "frugal innovation," and "competitive advantage" in the title as keywords. scientific papers were collected and analyzed from wos publications which is most acceptable database (gonzález-serrano et al., 2020). wos database has a significant number of journals and publications which fulfill the requirements of peer review (vázquez-ingelmo et al., 2019). figure 1 depicts the logical order of gathering the data from wos database. first, the original published papers were included in the field of management. second, books, editorials, conference proceedings papers, and book chapters and non-english articles were eliminated (hartling et al., 2017; lee et al., 2019). finally, 428 articles based in wos were included for bibliometric analysis. south asian review of business and administrative studies vol. 5, no. 1, june 2023 65 bibliometric analysis bibliometric analysis methods are categorized in various ways (aria & cuccurullo, 2017; donthu et al., 2021; durieux & gevenois, 2010; zupic & čater, 2015). by applying bibliometric analysis method, vosviewer software and r package were used on the data file extracted from the wos database for analysis of co-citation, co-occurrence of keywords, citation, co-authorship by country and bibliographic coupling. results the results of the bibliographic analysis reveal several important developments in the csr, innovation and competitive advantage literature. first, there is growing interest in the link between csr and innovation. numerous studies have found that csr can foster innovation by presenting fresh ideas, resources and perspectives. second, there is a direct link between innovation and competitive advantage. several studies highlight the role innovation plays in building lasting competitive advantage. third, further research is needed to understand the complex relationship between csr, innovation and competitive advantage, especially in the context of emerging markets and small and medium enterprises (smes). the analysis also identified numerous gaps in the literature. for example, currently there is a lack of understanding of how csr can support disruptive innovations that could transform industries and open up new markets. similarly, more research is needed to understand the precise ways in which csr fosters innovation and creates competitive advantage, including stakeholder engagement, knowledge sharing and networking. year base publications in this paper, publication patterns from 2009 to 2023 were thoroughly examined. the publishing trend for publications on csr, innovation, and competitive advantage from 2009 to 2023 is depicted in figure 2. only 51 out of 428 articles, or around 11.92%, were published between 2009 and 2013; the number of publications began to clearly increase after 2013. this increasing trend is due to iso 26000, which offers guidelines to organizations regarding accountability for the effects of their actions on society and the environment. the increasing trend suggests that these subjects are being studied academically, especially in recent years. moreover, 88% of papers (377) were available in the last decade 2014-2023 whereas 54% of papers (231) were available in the last five years 2019-2023. south asian review of business and administrative studies vol. 5, no. 1, june 2023 66 co-citation analysis a bibliometric technique that identifies the most frequently cited authors in a particular field of study is co-citation analysis (pilkington et al, 2006). table 1 reports the top 10 co-cited authors in the literature on csr, innovation, and competitive advantage, based on the wos database. results show that carroll, ab is the most co-cited author with 291 citations and 3801 total link strength during the sampled period. table 1: top 10 co-cited authors ranks keyword citations total link strength 1 carroll, ab 291 3801 2 mcwilliams, a 195 3008 3 porter, me 156 2186 4 jamali, d 131 1858 5 orlitzky, m 109 1915 6 brammer, s 100 1744 7 matten, d 93 1654 8 friedman, m 84 1309 9 aguinis, h 78 1463 10 maignan, i 75 1112 source: wos figure 3: co-citation analysis south asian review of business and administrative studies vol. 5, no. 1, june 2023 67 figure 3 shows a co-citation network map that visualizes the relationships between the top 10 authors. each author is represented by a node, and the thickness of the line connecting the nodes indicates the strength of the co-citation analysis. this network map lists groups of authors who are often cited together, showing that researchers have significant contributions to the csr, innovation, and competitive advantage literature. the current study may also indicate that some authors are well-known within the network, meaning they are frequently cited with many others and could have a significant impact on the field. overall, co-citation analysis provides valuable insight into the subject's intellectual structure and the major authors who contributed to its development. it helps researchers identify key issues, trends, and research gaps to guide research directions for future studies. co-occurrence analysis co-occurrence analysis depicts visual map that can be used to analyze the frequency of occurrence of keywords in the literature (jalal, 2019). table 2 shows the top 10 keywords that are most frequently used in the literature on csr, innovation, and sustainability, etc. based on the wos database. most frequent keyword is corporate social responsibility with 234 frequencies and 178 total link strength. table 2: top 10 frequently occurred keywords ranks keyword frequency total link strength 1 corporate social responsibility 234 178 2 sustainability 23 35 3 sustainable development 17 22 4 corporate governance 14 21 5 stakeholder theory 14 22 6 frugal innovation 12 6 7 social responsibility 12 11 8 stakeholder engagement 11 19 9 financial performance 10 15 10 corporate reputation 8 13 source: wos figure 4: occurrence of keywords south asian review of business and administrative studies vol. 5, no. 1, june 2023 68 figure 4 depicts a co-occurrence network map that visualizes the relationships between the mostly occurred keywords. each keyword is represented by a node, and the thickness of the line connecting the nodes indicates the strength of the co-occurrence analysis. a cluster of keywords often used together indicates that they are closely related concepts in the csr, innovation, and competitive advantage literature. certain keywords are the center of the network. this means they often appear alongside many other keywords and may be of particular importance to the subject. co-occurrence network maps help researchers visually explore and analyze relationships between keywords in the literature, enabling a deeper understanding of intellectual patterns in the field. citation analysis the most highly cited documents are identified in the literature through citation analysis (alshater et al., 2022). table 3 shows the top 10 most highly cited documents in the literature on csr, innovation, and competitive advantage, based on the wos database. marquis (2014) explores the role of cultural and institutional factors in modeling corporate social responsibility, while chatterji (2009) identifies links between environmental and financial performance. other frequently cited documents highlight areas such as stakeholder engagement (gond, 2017), frugal innovation (melo, 2012), and multinational corporate social responsibility (maon, 2010). table 3: top 10 cited documents ranks keyword citations total link strength 1 marquis (2014) 714 6 2 chatterji (2009) 583 9 3 albuquerque (2019) 341 1 4 gond (2017b) 305 8 5 tang (2015) 255 3 6 melo (2012) 255 7 7 bauman (2012) 246 2 8 dobers (2009a) 226 5 9 edmans (2012) 204 1 10 maon (2010) 192 1 source: wos figure 5: citation analysis south asian review of business and administrative studies vol. 5, no. 1, june 2023 69 figure 5 presents the content of the most cited literature to identify key themes and literature contributions on csr, innovation and competitive advantage. overall, citation analysis provides valuable insight into the most influential and impactful documents in the literature on a particular topic. this helps researchers identify the major themes, theories, and contributions that have shaped the field, and can guide future research directions. by analyzing the content of frequently cited documents, researchers gain a deeper understanding of the scientific structure, key debates, and existing controversies in the field. co-authorship by country analysis the patterns of collaboration among researchers can be analyzed by using co-authorship technique (kalhor et al, 2022). table 4 shows the top 10 countries for the number of co-authored publications on csr, innovation and competitive advantage, based on the wos database. looking at the top 10 countries, results show that the majority of co-authored documents were produced by uk researchers, followed by spain, the us and china. table 4: top 10 co-authorship by countries ranks keyword documents total link strength 1 united kingdom 83 91 2 spain 50 35 3 usa 46 44 4 peoples of china 40 39 5 netherlands 31 34 6 australia 26 24 7 france 25 36 8 italy 24 21 9 germany 21 20 10 brazil 15 10 source: wos figure 6: top 10 country collaborations index figure 6 shows that countries are particularly dynamic in research cooperation related to csr, innovation and competitive advantage. it is noteworthy that all of the top four countries are geographically diverse, suggesting that international collaboration is a major driver of research in this area. furthermore, the inclusion of countries such as the netherlands, australia and italy in south asian review of business and administrative studies vol. 5, no. 1, june 2023 70 the top 10 suggests that research on csr, innovation and competitive advantage is a truly global effort with contributions from various countries and regions. figure 7: co-authorship by country analysis figure 7 depicts visualization of co-authorship analysis that provides impactful insight into cooperation patterns among researchers from different countries in specific fields. this network map identifies the most active and productive countries and helps to provide better understand the intellectual networks and communities that have developed around csr, innovation and competitive advantage research. this can help determine future research directions and facilitate further collaboration between researchers in different regions working on this field. bibliographic coupling analysis bibliographic coupling analysis visualizes the relationships between documents based on shared references (nájera-sánchez et al., 2020). based on the wos database, table 5 presents the 10 most cited authors in csr, innovation and competitive advantage literature. results show that among the top 10 most cited authors; cuili qian was cited 969 times and had the highest overall link strength of 894. this shows that cuili qian has made significant contributions to research on csr, innovation and competitive advantage. it is also worth noting that some of the top 10 authors have published papers together. this is reflected in the overall link strength of the joint. the results show that swaen, valerie had a very strong overall connection with gond, jean-pascal and maon, francois proposing that they collaborated on some multiple publications. table 5: top 10 cited authors ranks keyword citations total link strength 1 qian, cuili 969 894 2 marquis, christopher 739 335 3 swaen, valerie 529 1431 4 gond, jean-pascal 443 1032 5 chen, guoli 388 880 6 tang, yi 388 880 7 scherer, andreas georg 338 742 8 lindgreen, adam 330 1672 9 maon, francois 330 1672 south asian review of business and administrative studies vol. 5, no. 1, june 2023 71 10 melo, tiago 324 693 source: wos figure 8: bibliographic coupling analysis figure 8 shows the most cited authors, including marquis and christopher; swaen, valerie; gond, jean-pascal, chen, guoli. all of these authors have made significant contributions to this area of research, as proved by their network visualizations. a visualization map provides impactful insight into the associations between documents within a particular area. by ascertaining the most cited authors and the associations between them, this research may lead to a better understanding of scholarly networks and communities developed around research in related fields. research implications corporate social responsibility (csr) and innovation are two significant research themes that have been widely studied in the literature and are closely related. the most cited authors and keywords provide insight into the most impactful researchers and research topics in the field and can be used to guide future research. a bibliographic coupling analysis found several leading authors who have been widely cited and have made significant contributions to the areas of csr, innovation and competitive advantage. their work can serve as a basis for future research and guide the development of theory in this field. conclusion bibliographic analysis provided insight into the most dominant authors, research themes and countries in the areas of csr, innovation and competitive advantage. the results highlight the link between csr and innovation and the importance of considering how these practices can lead to competitive advantage for companies. the results of this analysis will serve as a guide for future research and as a basis for theoretical development in this area. bibliographic analysis provides insight into the current state of research on csr, innovation and competitive advantage. research results show that the importance of csr and innovation is increasingly recognized for creating competitive advantage, but the composite interaction of these concepts requires further research. this study highlights several areas where future research could make an important contribution in understanding the links between csr, innovation and competitive advantage, especially in the south asian review of business and administrative studies vol. 5, no. 1, june 2023 72 context of emerging economies and smes. the analysis also identified numerous gaps in the literature. for instance, there is a current lack of understanding of how csr can support disruptive innovations that have the potential to transform industries and go for new markets. research limitations current 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(2015). bibliometric methods in management and organization. organizational research methods, 18(3), 429-472. south asian review of business and administrative studies vol. 5, no. 1, june 2023 74 south asian review of business and administrative studies vol. 1, no2, june 2019 57 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.2, dec 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas board financial expertise and debt policy bushra sarwar, university of science and technology beijing, china xiao ming, university of science and technology beijing, china marria hassan, universiti utara, malaysia sherzaman khan, university of science and technology beijing, china article details abstract history revised format: nov 2019 available online: dec 2019 keywords debit policy, board finance, financial expertise, economic decision this study examines whether board financial expertise affect firm leverage for the sample of pakistan non-financial listed firms. using panel data for the year 2010-2015, we examine the relationship between financial expertise on board and firm leverage. we find a significant positive relationship between presence of financial expertise on board and firm leverage. to control possible endogeneity, this study employs propensity score matching and found similar results. this study is important as it exhibits that the presence of financial expertise on board affects firm economic decision beyond reporting quality accuracy. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mariya.hassan@gmail.com doi: https://doi.org/10.52461/sabas.v1i2.438 introduction debates on the corporate governance still revolve around board composition that who will serve in shareholders’ best interest. confidence of shareholders have been shaken by various accounting scandals and financial crisis since 1990s like enron, healthsouth, tyco, and worldcom and financial crisis of 2007-2008, these have stressed regulators and market makers about the need of financial expertise of board members. their underlying assumption is that the presence of more financial expertise on board can improve board efficacy, help directors in understanding and monitoring management reporting process more meritoriously that they will not be accused of failure in their watchdog role and will better serve shareholder interest. benston & hartgraves, (2002) documented that these accounting scandals have raised doubts about the ability of directors specifically audit committee members to understand such operational irregularities. presence of financial expertise on board has gained more attention in response to widespread outcry followed by various accounting scandals since 1990s. in response to these accounting scandals, us congress has passed sarbanes-oxley bill in 2002 that require each member of audit committee should be independent and financial literate and one of its members should be ‘financial expert’. blue ribbon committee in 1999 have stressed the need of financial experts by recommending nyse and nasd that each large listed company should have an audit committee comprising of 3 members and each of whom is financial literate. smith committee in https://journals.iub.edu.pk/index.php/sabas mailto:mariya.hassan@gmail.com https://doi.org/10.52461/sabas.v1i2.438 south asian review of business and administrative studies vol. 1, no2, june 2019 58 2003 also proposed that at least one member of audit committee should have significant relevant and recent knowledge of financial experience. many academic researchers have support shareholders claim by empirically showing financial expertise are related to higher reporting quality (agrawal and chadha (2005), mangena and pike, 2012; benston & hartgraves, 2002; kusnadi, leong, suwardy and wang, 2015). recent strand of research on financial expertise focus on the fact that their financial expertise as board member effects beyond reporting quality, they effect major corporate policies like investment, dividend, tax planning and hedging (guner et al., 2008; robinson, xue, and zhang, 2012 and dionne and triki, 2005; sarwar et al, 2018). in this paper, we analyze whether presence of financial expertise on board effect beyond reporting quality in pakistan by investigating the relationship between proportion of financial expertise on financial leverage. this study would contribute to existing literature in several ways, this study has focused financial expertise of pakistani non-financial listed firm’s board members for which no study has so far been conducted. this study would help investor to analyze firm policies and board member expertise while investing in firms could higher their confidence that they are investing their money in companies whose board members better understands their interest and misreporting by management who are not the owner (agency cost). for economic stability, firms are in greater need of financial reporting efficacy and regulators are more likely to force companies to plead more knowledgeable directors on board. this study could force regulators to force companies to have financial expertise on board to cater need of shareholder by maximizing their wealth and perform their monitoring role more vigorously. to the best of researcher knowledge this study first time analyze the impact of board financial expertise on firm leverage. debt policy and board in order to achieve firm goals all their investment should be financed appropriately. financing policy is one of the important policies that will influence the firm’s value. financing mix of the company must be determined because it impacts the valuation of firm. literature provides evidence that capital structure of company is oftenly a combination of several securities including bank loans, debentures or bonds, shares, lease financing and the utilization of retained earnings. numbers of theories have been developed in past to determine optimal capital structure. optimum capital structure is the tradeoff between benefits and cost associated with debt financing. tradeoff theory predicts that when firm set a target debt level, there is trade-off between benefits and costs associated with debt. static trade-off theory argues that trade-off capital structure advocates optimal debt ratios, that are based on the trade-off between interest tax shield and cost of financial distress. titman and wessels (1988) documented that target debt ratios maximize firm value and reduce external claims over the firm. in context of trade-off between debt and equity; agency theory hypothesized that target debt level is set to minimize agency cost between debt and equity financing (jensen, 1986). dynamic trade-off theory hypothesized that adjustment cost associated with frequent adjustment of leverage ratio prevent firms from frequent capital adjustments. in contrast to trade-off theories pecking order theory argue that firm uses their internal finances first before going for external finances and issuance of equity. pot argues that firms do not have any target debt ratio (mayers and majluf ,1984 ) , therefore firms uses capital with such preferences ; accumulated earnings , short term borrowings , long term borrowings and then issuance of capital in order to get maximum benefit of debt and equity. in context of tot and pot theories, companies have two sources to finance their projects; one is internal financing (equity) and other one is external financing (debt). first method is less risker than external financing with respect to cash flow commitments. when companies use debt financing as a source of funding, they are obliged to service their debt. companies are considered to be high leveraged if they have debt more than the equity. if south asian review of business and administrative studies vol. 1, no2, june 2019 59 companies are unable to service their debt properly, they may be at bankruptcy risk. shareholders perspective about debt is not always bad but they considered debt can increase their return on investment because of tax advantage associated with it. in contrast to tot and pot agency theory argue that agency cost determines capital structures. debt financing can mitigate agency problem in several ways. first, short term debt can reduce discretionary funds as well as managers perks consumption. debt requires the firm to pay out extra cash that is available for mangers to violate for their own benefits. second, use of leverage can increases mangers efficiency, because the likelihood of bankruptcy force mangers to make efficient use of their abilities in order to avoid value decreasing corporate policies (grossman and hart, 1982). mangers who fail to meet debt obligations can be replaced by efficient managers who can better serve the interest of shareholders. mangers need to meet debt obligations, they are likely to return access cash flows to shareholders instead of violating cash for their own benefits and for investing in negative npvs (lubatkin and chatterjee, 1994). third, leverage can lessen agency costs by increasing mangers ownership in firm. higher leverage increase percentage of equity owned by management and reduces the level of equity owned by shareholders. as mangers equity increases their interest aligns with shareholders’ interests. one of the ways to reduce agency conflict is to increase mangers ownership in firm (jensen and meckling, 1976). harford et al., (2008) documented that use of debt help lessen agency conflict by exposing firms to be more frequently monitored by bond holder, bond rating agencies, investment banker and lenders, thereby restricts self-serving behavior of managers. because debt impose constraints on mangers discretion, agency theory suggests that mangers may adopt sub-optimal capital structure that does not necessarily maximize the wealth of shareholders. managers may choose debt ratio that maximize their own personal interest rather than the maximization of shareholder wealth. extent to which mangers take sub-optimal debt ratio vary with corporate governance strength as corporate governance is designed to combat conflicts among shareholders and mangers. literature shows capital structure decisions are shown to be affected by corporate governance mechanism. berger er al. (1997) empirically analysed that entrenched managers prefer equity to debt, whereas mangers prefer more long-term debt who will get less equity-based incentives documented by (datta et al, 2005). ashbaugh-skaife et al. (2006) documented that corporate governance practices are found to be associated with firm credit rating and cost of debt. thus, corporate governance plays an important role in deciding optimal capital structure. in addition to corporate governance firm investment policy can affect corporate leverage policy. growth opportunities are identified as one of significant determinant of firm leverage documented by (myer, 1977; rozeff, 1982). capital expenditure as proxy for firm growth can affect leverage. firms with higher growth opportunities may not issue debt. high growth firms with outstanding debt when need extra equity financing for investment, they may forgo such opportunities if wealth is transferred from shareholders to debtholders. (myers, 1977). jensen and meckling (1976) documented that leverage is negatively related to growth opportunities. rajan and zingales, (1996) provide empirical evidence of negative relationship between leverage and growth opportunities. empirical evidence shows the board has power to set firm financing policy and board uses it. guner et al (2008) documented that composition of board impact firm financial policies. board has power to force mangers based on their expertise for higher debt, therefore positive relation is expected. h1: proportion of financial experts on board are positively related to level of leverage. south asian review of business and administrative studies vol. 1, no2, june 2019 60 possible endogeneity: several methods are employed to control possible endogeneity, this current study has used propensity score matching method to test endogeneity. empirical accounting studies wherein hypothesized casual variable is endogenous choice by mangers board of directors or other stakeholders, propensity score matching method should be employed to check endogeneity (armstrong, jagolinzer, larcker ,2010). lennox, francis and wang (2012) documented that major advantage for using propensity score matching is that it does not require any appropriate exogenous instrument variables and not relying on specific functional form. for propensity score matching method, propensity scores were computed based on probability that firm has financial expertise with given firm characteristics; all firm characteristics included in main regression. propensity score matching method matches observations based on probability of financial expertise. logit estimations and one to one nearest neighbor match without replacement is used to calculate propensity scores research sample: initially selected sample size for current study consists of 396 non-financial listed firms as per “financial statement analysis report of non-financial listed companies at pakistan stock exchange from 2009-2014”. banking and other financial sector companies are excluded from current sample size having different regulatory requirements and their board members are also subject to specific regulations of pakistan central bank (state bank of pakistan). for the targeted 396 non-financial listed firms, we try to manually collect annual reports for the period 2010-2015 from different sources; company’s websites and opendoors.pk database. board members profiles including their educational background, working experience collected from annual statements and company’s websites and from secp (regulatory body of pakistan). further, data for corporate policies are collected manually from company’s annual statements. due to non-availability of board members profile for targeted companies as well as annual statements on companies’ websites, i collect complete data for 187 non-financial listed companies from 2010-2015. research model: board financial expertise board financial expertise is measured by using proportion of financial expertise on board. according to sarbanesoxley act of 2002 (sox) section 407, financial expert as a person who has experience of accounting, finance or having supervisory expertise, financial expert has experience in accounting, auditing, finance positions, or supervising employees with financial responsibilities. different researchers have used sox definition to define financial expertise (defond, hann, and hu, 2005; krishnan and visvanathan, 2008). for recent study, i classify financial expert as person having degree in accounting, finance, and economics, having experience of working as accountant, auditor, chief financial officer, finance manager, financial advisor or financial analyst in any financial or non-financial firm. debt policy 𝐻1: proportion of financial expertise on board is positively related to level of leverage 𝐿𝐸𝑉𝐸𝑅𝐴𝐺𝐸 = 𝛽0+ 𝛽1𝐹𝐼𝑁+ 𝛽2 𝐿𝑛𝑇𝐴 +𝛽3 𝑅𝑂𝐴 + 𝛽4taxshield + 𝛽5divdummy + 𝛽6 𝐶𝑎𝑝𝐸𝑥𝑝+𝛽7networkingcapital+ 𝛽8 𝐼𝑛𝑡𝑎𝑛𝑔𝐴𝑠𝑠𝑒𝑡 + 𝛽9 𝐶𝑎𝑟𝑟𝑦𝐹𝑜𝑟𝑤𝑎𝑟𝑑 + 𝛽10inst + 𝛽11 ppe for debt policy hypothesis, dependent variable is leverage leverage: total debt/total assets independent variable: fin = proportion of financial experts on board. south asian review of business and administrative studies vol. 1, no2, june 2019 61 other control variables are: lnta = natural logarithm of total assets roa = net income/total assets taxshield = depreciation+ amortization/total assets divdummy=1 is firm pays dividend otherwise divdummy=0 capexp= capital expenditure/total assets networkingcapital= (current assets-current liabilities)/ total assets intangasset= intangibles/total assets carryforward = 0 if firm has net operating loss otherwise carryforward = 1 inst = percentage of institutional investors holdings ppe= ppe/total assets to test 𝐻1 , current study has used ols regression model. several researchers deangelo and masulis, (1980), titman and wessels, (1988), mehran,(1992) and faulkender and petersen, (2006) have used firm characteristics that can effect firm capital structure are firm size (lnta) , roa (company profitability) , non-debt tax shield (taxshield), ppe (tangibility of assets), dividend , capital expenditure , working capital and intangible assets as control variables. therefore, current study has also considered these control variables in context of developing market of pakistan. shleifer and vishny (1986) documented that larger shareholders have incentive to oversee management activities, therefore percentage of institutional investor on board is also considered as control variable for identifying firm capital structure. results & discussion summary statistics table shows summary statistic for current study sample, including mean, standard deviation and median. result shows this sample includes comparatively large firms having total asset mean over 22.6 billion with a standard deviation of 1.6 billion. financial expert’s proportion on board as mean for current sample is 57.9 %. table 1: descriptive statistics of regression variables regression results for debt policy above table shows ols regression results for firm debt policy. dependent variable is leverage. result shows proportion of financial expertise on board are positively related to firm leverage policy. board has power to set firm financing policy and board uses it. results are consistent with findings of (guner et al, 2008) that documented presence of financial expertise on board are related variable obs mean std dev median fin 1085 .5794 .1713 .5714 divdummy 1085 .6525 .4763 1 leverage 1085 .5988 .3565 .581 capexp 1085 .0469 .05934 .027 lnta 1085 22.580 1.552 22.437 roa 1085 .0500 .0999 .045 inst 1085 16.355 16.976 11.2 ppe 1085 .4583 .2304 .464 networkingcapital 1085 .0437 .4455 .045 taxshield 1085 .0372 .0484 .031 intangasset 1085 .0070 .0294 0 carryforward 1085 .2304 .4212 0 south asian review of business and administrative studies vol. 1, no2, june 2019 62 to higher loans within firms, and the presence of more financial expertise on board related to marginal increase of leverage. table 2: debt policy and board financial expertise leverage random effect gls regression coff p value fin 0.0386 0.002 lnta -.0219 0.008 roa -.3413 0.000 ppe .02352 0.563 taxshield -.3482869 0.164 networkingcapital -.7616586 0.000 intangasset -3.356886 0.000 carryforward -.1006168 0.001 capexp -.0183634 0.185 divdummy .03372 0.318 inst .0000366 0.977 n 1122 r2 .6373 standard errors are clustered at firm level for all regression there is a negative relationship between firm size and leverage that is consistent with pot (pecking order theory). pot assumes negative relationship between firm size and leverage. larger firm have less asymmetry of information therefore they can issue more equity rather than external financing (rajan and zingales, 1996). smaller firms have asymmetry of information therefore they issue less capital because of undervaluation of equity and they don’t have collateral for long term debts, so they go for short term debts to meet their financing requirements. negative and statistically significant relationship is found between roa and leverage. pot assumes negative relationship between leverage and firm profitability, firms that are more profitable firstly uses their accumulated earnings and then got for external financing, results are consistent with the findings of long and malitz (1985), baskin (1989), michaelas et al. (1999), al-sakran (2001), dorbetz and fix (2003) and chen (2004). negative relationship found between asset tangibility and leverage. this negative relationship is consistent with pecking order theory that firms with high tangible assets on their balance sheet rely more on the generation of internal funds from these assets (degryse et al. 2010). ratio of sum of depreciation and amortization over total assets is a proxy for non-debt tax shield. relationship south asian review of business and administrative studies vol. 1, no2, june 2019 63 between non-debt tax shield and leverage is significantly negative indicates non-debt tax deductions are substitute for tax benefits. significantly negative relation found between networking capital and leverage shows as firms are more liquid, they use less debt. presence of institutional investor on board does not affect leverage policy. endogeneity test: propensity score matching by employing propensity score matching method for both treated sample and whole sample, almost same results are found. table 3: matched propensity scores (dependent variable – debit policy) fin coff al robust std.error z p>|z| ate 0.035 0.07 -4.33 0.000 debt policy (1 vs 0) fin coff al robust std.error z p>|z| atet 0.062 0.05 -2.89 0.000 debt policy (1 vs 0) conclusion this study investigates whether presence of financial expertise on board affect firm leverage policy. by using panel data for the year 2010-2015, present study finds a significant positive relation for firms leverage. presence of financial expertise on board affect beyond financial reporting quality (sarwar et al, 2018). board members has power to set firm financing policy, and the result confirms that board uses financial expertise to set firm financing policy. results further confirm that board member having financial expertise knows more about firm financing, and their directorship has positive impact on firm leverage. study further employs psm and produces similar results. overall, the 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emerging equity markets of china and pakistan. management decision, 56(9), pp.1839-1868. myers, s.c. and majluf, n.s., 1984. corporate financing and investment decisions when firms have information that investors do not have. journal of financial economics, 13(2), pp.187221. south asian review of business and administrative studies vol. 1, no2, june 2019 66 south asian review of business and administrative studies vol. 1, no. 1, june 2019 23 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.1, june 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas prediction of future returns through earning management: a case of pakistan marria hassan, universiti utara malaysia. article details abstract history revised format: may 2019 available online: june 2019 keywords workplace belongingness, affective commitment, job crafting, appreciative leadership companies world over are often found indulge in activity of hiding their real financial positions by decorating their financial statements with false digits. this concept referred to as earning management, which plays a significantly critical role in investor performance in stock market. in this paper analysis of probability of earnings manipulation using beneish model is performed. sample comprised of two sectors; sugar and cement as listed at karachi stock exchange. various firms in cement and sugar sector were distinguished as manipulators and non-manipulators as per the data analysis. results predicted that 54.65% of the companies were manipulating their performance through window dressing and remaining 45% were non manipulators. methodology to apply beneish model as opted from beneish basic paper (1997) was used which marked manipulator companies with value as “1” and non-manipulator companies by “0” with the objective to benefit investor of the stock market and save them from getting misguided by false financial statements. the variable of the study as calculated by the help of those 8 variables included in beniesh model is called probm (probability of manipulation). the study also explores ability of probm to predict the future returns. results revealed that probm and other variables remained insignificant in predicting future period returns in the context of pakistani stock market. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mariya.hassan@gmail.com doi: https://doi.org/10.52461/sabas.v1i1.448 introduction usefulness of accounting earnings to investors cannot be denied. more than half of the information about any firm, which is presented in a year, is confined in that year’s income figure and accounting earning is significantly connected with changes in stock prices (ball and brown 1968). an interesting connection between earnings and stock prices has been proved. first link shows that current earnings help in the forecast of future earnings. second, future earning helps in estimating expected future dividends and third connection establishes that the current value of https://journals.iub.edu.pk/index.php/sabas mailto:mariya.hassan@gmail.com https://doi.org/10.52461/sabas.v1i1.448 south asian review of business and administrative studies vol. 1, no. 1, june 2019 24 these anticipated future dividends decide the share price. (beaver 1998; nichols and wahlen 2004). as we have discussed that current level of earnings can predict future levels of earnings. hence the present level of earning is probable to get repeated in the future time periods. the repetitive occurrence of earning figures in future is termed as earning persistence (francis and smith 2005). it has been established that more persistent earnings are translated into better stock returns (kormandi and lipe 1987). earnings can be improved by manipulating the earning figure. (xie et al 2001).stock price generally fail to reflect any effect of accrual anomaly and investors do not incorporate public information. (bernard and thomas 1989, 1990; sloan 1996, beneish 1997). in this study we have identified the manipulation of earnings by the firms in pakistan. we have also tried to establish if probability of earning manipulation can consider the relation between accruals and future returns. in this paper using we predicted either if a company is a manipulator or a non-manipulator using beneish model. probm was used as an identifier of a company’s category of either manipulator or nor manipulator. our major objective for this paper was to gather information for capital markets. in context of the benefits for the capital market participants to incorporate market information effectively, our findings raise the question of why probm predicts this. we show that probm has implications for future earnings that market participants seemingly ignore or misunderstand (beneish et al., 2007). literature review recent studies have examined manager’s intentions to control the valuation of stock that influence equity offering by exaggerating earnings, (teoh et al. 1997), or manage earnings to come upto the expectations of the market analyst’s prediction. (burgstahler and eames 1998). efficient market hypothesis states that investors cannot be misguided by accounting manipulations as stock prices already utilize all available information, as reported by fama (1970) mayer-somners (1979) hines (1982). analysts, investors, senior executives, and boards of directors consider earnings as the single most important item in the financial reports issued by publicly held firms (francois et al., 1999). it’s is established that investor will feel more certain toward a company that announces constant earnings (hepworth 1953). it is reported by sloan that the cash flow constituent of earnings is more continual than accrual factor of earnings (sloan 1996), and that when earnings persistence is high, there is a positive relationship and following stock returns move in the similar direction as that of changes in earnings. he shows that market investors usually fail to precisely distinguish the differing level of persistence in earnings from both cash flows and accrual element of earnings. this is so called 'accrual anomaly' in securities returns. from the perspective of stock market, earning persistence is important because its understanding can be used to estimate returns on stocks (sloan, 1996). where, yearly stock returns are significantly related to the symptoms of annual changes in earnings (ball and brown 1968). earnings persistence is an extent to which a current period earnings shock affects future earnings (lipe 1990). earnings increasing accounts change is accompanied by a positive abnormal stock return and vice versa irrespective the effect of the change on the present value of cash flows (ball south asian review of business and administrative studies vol. 1, no. 1, june 2019 25 and brown, 1968). (ball 1972) and (kaplan and roll 1972) assume that financial statements are the solitary source of information about the firm, and investors prediction of stock prices is only based on the accounting earnings. they found that stock prices are related to the variations in the accounting methods. transitory earnings contribute much less to value of stock returns than persistent earnings (nichols and wahlen 2004). it was reported that earning persistence helps explaining differences in the relation between stock return and earnings (kormandi and lipe 1987). although structure of gaap says earning management is legal, but it may lead to a special case that is intertemporal smoothing of reported earnings relative to economic earnings (anand and thakor 2003). smoothing represents garbling, performed by managers to fool analysts and others and to enhance managerial compensation (li and richie 2009). sometimes earning persistence arising from earning manipulation is due to accruals which are primary indicators of earnings persistence and unusual stock returns (sloan 1996). where, total accruals are decomposed into nondiscretionary and discretionary components using the jones model. it is further said that the out of discretionary and non-discretionary accruals it is assumed that managers distort discretionary accruals to manipulate earnings xie (2001), defond and kothari (2001). it is well documented that earnings are incrementally informative to operating cash flows (bowen et al., 1987), and (dechow 1994). where expected stock returns emerge because investors do not foresee the lower persistence of the less consistent accrual components of earnings (sloan 1996). economy is pillared on conviction and reliability of financial information, here; stakeholders look for ways to identify earnings manipulation (beneish and nichols 2007). earnings management can either be an opportunistic attitude of manager for maximizing their utility on account of other stakeholders or a method used by management to use provision in accounting policies to reduce the interest rates on debt or to refrain from huge fluctuations in the stock prices, which is an example of income smoothing (scott 1997). earnings manipulation commonly happens through use of discretion over accruals, keeping in mind that accruals are one of the eight inputs into the probm model (probability of manipulation) (beneish and nichols 2007). an assessment of earnings persistence determined by fundamentals to persistence expectations entrenched in stock prices using the mishkin’s (1983), evaluated that earnings persistence implied by stock prices is higher (lower) than fundamentally determined earnings persistence when the persistence is low (high). also the non-reliability of jones approach with its predictable degree of error (guay et al. 1996; beneish, 1998) calls for an alternative provided by mesood d. beneish in 1999, where he improved his previous model in a work along with craig nichols. it is reported that managers doing dubious accounting practices along with other value-destroying dealings to maintain overvalued stocks (jensen 2005). where, fake financial reporting imposes a big cost upon financial markets (beneish and nichols 2007). on the other hand, research continuously finds that behavior of prices manifest that investors forgo the implications of instantly available public information (lakonishok et al., 1994). recent analytical and experimental research has tried to explain post earnings announcement drift (pead) and other market anomalies in a context of behavior and identify conditions for stock price underand overreaction. south asian review of business and administrative studies vol. 1, no. 1, june 2019 26 this phenomenon is called moderated confidence because investors expectations are moderated toward an average level that is insufficiently extreme. the moderated confidence model suggests that the stock price underand overreaction are predictable based on information’s statistical reliability. when investors have received signals having noise shocks about the statistical reliability of information, stock prices underreact to reliable information and overreact to unreliable information (bloomfield et al. 2000). stock prices behave as if investors use a immature earnings expectation model and systematically underestimate earnings persistence (bernard and thomas 1990), (ball and bartov 1996), (soffer and lys 1999). in this way if market participants are unsuccessful to use available information to evaluate the probability of manipulation, probm should negatively relate to future returns ( beneish and nichols 2007). significance of earnings anticipation for financial-statement evaluation, where paradigm is, and earnings will be consistent if no monetary shocks and problems in seminal of accounting income (dichev and tang 2009) and cash flows (sloan 1996 and fairfield et al. 2003), (dechow and ge 2006) and (fairfield 2006). methodology we have collected data for companies in cement and sugar sector from year 2001-2009.most of the balance sheet data has been gathered from balance sheet analysis whereas historical prices and stock data has been extracted from business recorder and karachi stock exchange website. basic beneish equation was run and results were demonstrated for the two sectors by calculating their respective m-score. beneish model we are using beneish model (1997 and 1999) for our research. beneish model detects and distinguishes which firm is manipulating earnings and which firm is not. the model is based on eight variables which expose manipulators and non manipulators. the model has been previously tested for the measurement of fraud in firms like enron etc. it effectively calculates the probability of manipulation (probm). the equation specifically employed for the measurement of fraud is as follows: probm= -4.84 + 0.920*dsr + .528*gmi + .404*aqi + 0.892*sgi + 0.115*depi (1)– (0.172*sgai) + 4.679*accruals 0.327*levi where: 1. dsr = (receivables t/sales t) / (receivables t-1/sales t-1). the above formula indicates day’s sales receivable measured as the ratio of days’ sales in receivables in year t to year t-1. a large increase in dsr shows that revenue has been overstated. 2. gross margin index is measured as the ratio of gross margin in year t-1 to gross margin in year t. gross margin is assumed to be deteriorated when this index is above 1. a firm with weaker growth opportunities is more likely to manipulate earnings. the formula for measuring gmi is as follows. gmi= salest-1-cost of goods sold t-1 ÷ sales t –cost of goods sold t sales t-1 sales t 3. asset quality is measured as the ratio of non-current asset divided by total assets. aqi ratio measures the asset quality in year t to year t-1. the formula for measuring aqi is as follows. south asian review of business and administrative studies vol. 1, no. 1, june 2019 27 aqi=1current assetst – ppe t ÷ 1current assets t-1–ppe t-1 total assets t total assets t-1 4. ratio of sales in year t to sales in year t-1 is called sales growth index. this index is not a direct predictor of manipulation but firms are likely to manipulate growth to improve earnings... the formula for measuring sgi is as follows. sgi= sales t /sales t-1 5. depreciation index is measured as the ratio of the rate of depreciation in year t-1 to the rate of depreciation in year t. depi greater than 1 indicates that assets are being depreciated at a slower pace. this shows that the firm is adopting a new method for depreciation that is income friendly. the formula for measuring depi is as follows. 6. depi = depreciation t1 ÷ depreciation t depreciation t-1+ ppe t-1 depreciation t + ppe t 7. sales and general administrative index is the ratio obtained by dividing sga expenses in year t from those in year t -1.the formula for its calculation is given. sgai = sga expense t sga expense t-1 sales t sales t 8. levi denotes leverage index here. the ratio of total debt to total assets in year t relative to year t-1.an lvgi >1 indicates an increase in leverage. it is calculated using the formula given below. levi = long term debt t –current liabilities t long term debt t-1 – current liabilities t-1 total assets t total assets t-1 tata is the ratio of total accruals calculated as the change in working capital accounts less depreciation. the formula given below represents tata calculation. accruals= (total accruals) / total assets all these eight variables collectively compute m score. m score has been donated by binary values 0 and 1 for manipulators and non manipulators respectively. if value of the m score for a firm is less than -2.22, the firm is a non manipulator and is denoted by a zero in this paper. whereas, if m score is greater than -2.22 the firm is assumed to be a manipulator. to find out the coefficients of beneish model to be used in the context of emerging economies like pakistan, we employed principal component analysis technique (pca) in stata software, so that the component with the highest eigenvalue could be identified. the pca analysis showed the following results. south asian review of business and administrative studies vol. 1, no. 1, june 2019 28 principal components/correlation component eigenvalu es differenc e proporti on cumulati ve comp 1 1.28724 0.151403 0.143 0.143 comp2 1.13583 0.0590172 0.1262 0.2692 comp 3 1.07682 0.0722754 0.1196 0.3889 comp 4 1.00454 0.0036196 7 0.1116 0.5005 comp 5 1.00092 0.0093459 5 0.1112 0.6117 comp 6 0.991576 0.0933662 0.1102 0.7219 comp 7 0.89821 0.0214889 0.0998 0.8217 comp 8 0.876721 0.148583 0.0974 0.9191 comp 9 0.728138 0.0809 1 principal component analysis (pca-stata) amongst all the eight components, component 1 holds the highest eigen-values. hence we will extract the eigen vectors of component 1 from the principal component table to modify the coefficients in the beneish model equation. the eigen vector for the component 1 to be used as coefficients in application of beneish model the context of pakistan can be observed from the table given below: principal component (eigenvectors) variable comp 1 probm 0.0135 gmi 0.638 aqi 0.0215 sgi -0.6712 accruals -0.1827 dsr 0.2548 levi 0.1775 sagi 0.0818 depi -0.0726 hence, our equation for beneish model using new coefficients would be probm= 0.0135 + 0.2548*dsr + 0.638*gmi + 0.0215*aqi -0.6712*sgi0.0726*depi+0.0818*sgai-0.1827*accruals +0.1775*levi after the application of this model, many firms were identified as manipulators and as nonmanipulator. as predicted by the results of beneish equation we found that 54.65% of the companies were manipulators and remaining 45% were non manipulator. south asian review of business and administrative studies vol. 1, no. 1, june 2019 29 we have denoted non-manipulators with a “0” and manipulators with a “1” in m-score. in this paper the coefficients have been found to be used especially, for the firms in the developing economies like pakistan. probm includes the relation between accruals and future returns: we are now investigating whether one strategy hedge returns subsume others by excluding omitted variables related to future returns. year ahead returnst+1=a0 + a1 probm +a2 accrual + a3 beta+ a4 b/p+a5 rett + a6 (mve) + a7 ret vol + a8cfo/pt+a9uet + e t+1 where independent variables represented by probm indicates probability of manipulation, accruals, betas have been calculated for each firm, b/p denotes book value of stockholder’s equity divided by price per share, yearly returns, returns volatility (gaarch), cash flow divided by price (cfo/p) and earnings surprises (ue).the dependant variable is one year ahead returns. we applied regression in stata software to find out whether the above-mentioned independent variables predict future returns. the results are summarized as follows: return one year ahead coef. st error t p>t earning surprise 0.000011 5 0.000088 3 0.13 0.896 market value of equity 0.136337 0.320715 2 -0.43 0.671 returns 0.069964 8 0.045609 8 1.53 0.126 book/price ratio 0.000622 0.001343 -0.46 0.644 return volatality 0.000893 5 0.000816 5 1.09 0.274 cashflow/price 0.000989 6 0.002617 3 0.38 0.706 beta 0.111806 0.180122 5 -0.62 0.535 accrual 0.326043 1.46453 -0.22 0.824 probm -6.81 2.17 -0.31 0.754 _cons 3.889185 1.889269 2.06 0.04 as p value of current year returns is greater than the level of significance, therefore, we will accept the null hypothesis that co-efficient of ret is equal to zero. thus ret does not predicts one year ahead periods. this result is not consistent with beneish (2007). the rest of the variables also remained insignificant in predicting the year ahead returns as the p value remained greater than the level of significance. though prior researches have shown that above mentioned variables are correlated with subsequent returns (chan et al, 1994, jegadeesh and titman 1993.haugen and bernard and thomas 1989). the reason for the insignificant results can be the usage of a different time period and sample. conclusion & recommendation future researches can explore the applicability of his model using paired sampling. determination of a new cut off point would also be of utmost significance. the results can be improved if the south asian review of business and administrative studies vol. 1, no. 1, june 2019 30 model is applied on those companies’ who have been declared as manipulators over the last few years i.e. steel mills of pakistan, pia etc. the application of this model can be tested on other sectors as well. after the application of this model, many firms were identified as manipulators and as nonmanipulator. as predicted by the results of beneish equation, we found that 54.65% of the companies were manipulators and remaining 45% were non manipulator. because the fraud detection model relies on accruals, and because accruals also predict returns, we carefully distinguish the predictable returns from the two strategies. we have denoted non-manipulators with a “0” and manipulators with a “1” in m-score. in this paper the coefficients of beneish model have been found to be used especially, for the firms in the developing economies like pakistan. the model is of immense significance to investors, industrialist, managers and even tax regulatory bodies. however, the probm and other variables employed for predicting future returns remained insignificant in pakistan, a reason for such results can be highly unpredictable stock market of pakistan and an economically unstable and underdeveloped country. according to the previous researches, the firms with high probability of manipulation should have high future returns whereas those with low probability of manipulation should also have higher expected future returns. our findings also showed that probm does not explain any movement in future stock returns. we can also infer that investors fail to incorporate the information about manipulations in earnings while 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ratios. journal of accountancy, p.80-83. south asian review of business and administrative studies vol. 1, no. 1, june 2019 32 xie, h., 2001. the mispricing of abnormal accruals. the accounting review, (76), p.357-373. south asian review of business and administrative studies vol. 2, no. 2, december 2020 97 impact of stress on the performance of the employees of microfinance banks in bahawalpur, pakistan sahrish khan, govt sadiq college women u niversity, pakistan waseem ul hameed, universiti utara, malaysia article details abstract history revised format: november 2020 available online: december keywords lack of motivation, workload, time pressure, employee performance, microfinance bank, the purpose of this study was to reveal the impact of stress on the performance of the employees of microfinance banks in bahawalpur. for this purpose, employees from various microfinance banking sector were chosen. the study used a sample of 100 respondents (employees of microfinance banks) through a questionnaire with 22 items based on a 5-point likert scale. the questionnaire was tested for reliability and validity. the questionnaire included statements to access whether time pressure, workload and lack of motivation, as measures of stress, have any effect on the performance of employees of microfinance banks in bahawalpur. regression analysis (in spss) revealed that time pressure and workload significantly reduce employee performance, whereas, lack of motivation did not influence employee performance significantly. future studies may consider using a larger sample size and extend to other sectors (with similar nature of job) which have not been covered in this study. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email: expert_waseem@yahoo.com doi: https://doi.org/10.52461/sabas.v2i2.449 introduction in this empirical study, we will investigate the effects of the stress on work life of employee’s in microfinance banks. the study further finds out the relations between the independent variables and dependent variables. the independent variables are the lack of motivation, workload and time pressure and the dependent variable is the performance of employees. the nature of study is quantitative. the data was collected by the employees of total 100 from microfinance banking sectors. the study used the spss software for the analysis. regression analysis is also used. the result was given according to the data that was collected through questionnaire. at the end the findings and the conclusion will be given. one of the most general known organizational diseases is job stress that can affect employee performance both physically and mentally. stress arises when the individual’s ability and the job demand are mismatch. it is very difficult to decrease the level of stress among employees. stress can negatively affect the work life of employees during their job. volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.2, december 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas mailto:expert_waseem@yahoo.com https://doi.org/10.52461/sabas.v2i2.449 https://journals.iub.edu.pk/index.php/sabas south asian review of business and administrative studies vol. 2, no. 2, december 2020 98 according to the (kishori & vinothini, 2016) in term of physical and emotional response workplace stress is very harmful because of mismatch between the job demand and all capabilities and the resources and needs of employees. such conditions also may create the poor performance at work and health problems. today the stress is very costly problem in the workplace. the researcher also reveals that stress is a major cause of the turnover in the financial institutions. (sharma, jauhari, & singh, 2015)in his study describe the stress that is an imbalance between mental and emotional levels of an individuals. stress occurs between the ability of individuals and situational demand when there is a disparity. stress can be in the form of both the positive and the negative. it is positive when there is an opportunity to gain something and act like a motivator. it is negative when the individual face physical, emotional, and organizational problems. according to the (hamdan, 2012) stress is defined as a dynamic condition in which the outcomes are considered to be unknown and predominant. work stress is mainly concerned with the organization. according to the (jarinto, 2011) stress is a common phenomenon which grows in any individual’s everyday life. it is very difficult to avoid the stress level. stress is defined as a force which creates the physical and psychological disturbance and also causes the change in individual behavior. a person loss his self-balance because of stress. the general determination of the research is to find out the influence of stress on the work life of the employee’s in microfinance bank. the microfinance banks of bahawalpur are selected for the research. finally, based on the above discussion, the objectives of the study are as follows; 1. to identify the effects of lack of motivation toward the performance of employees. 2. to study the effects of workload toward performance of employees. 3. to find the effects of time pressure toward the employees’ performance. literature review according to the (murali, basit, & hassan, 2017) both the time pressure and role ambiguity consumes a significant undesirable influence on the employee’s performance. they can reduce performance of employees in all aspects. therefore, it is important for all managers to minimize the role ambiguity and communicated the clear roles for improving the employee performance. also, the manager should avoid the time pressure that negatively affects the performance of employees. the other two factors which are lack of motivation and workload do not require a negative effect on the performance of employees. (islam, rahman, reza, & rahman, 2014)identify the factors that causes stress and affect the performance of bank employees negatively. the finding of this study shows that both the workers and management are responsible for creating job stress. so, the managers and employees can reduce their job stress and improve job performance a study conducted in india (priya & soni, 2017) discussed that there is substantial association among the stress related to job and employee performance. researcher also find that there are substantial relations among all demographic variables for example age, sex, education sector and the impact of occupational should adopt new coping strategies that reduce the level of stress. (charity, 2016)in their research discussed that the variables such as family factors, economic factors, job difficulty factors and factors related to organization affect the employee performance in the financial institutions of nigeria. therefore, for reducing stress, organization should put in place energetic planning, openly communicated channels with their management and peers and south asian review of business and administrative studies vol. 2, no. 2, december 2020 99 rewarding the innovation and creativity. the managers should encourage the teamwork between the workers and introduce the training programs through which the stress can be controlled. another study conducted in sri lanka (jayasinghe & mendis, 2017)is trying to identify that the stress is related to job, organizational and individual factors. the researcher found that there are adverse associations among stress and the performance of workers and concluded that the stress can affect the work life of bank employees. most organizations do not give importance to stress; this research paper will give the reasons to consider stress of employees’ as a significant factor in increasing the performance of employees. according to the (das & srivastav, 2015)the purpose of the research is to identify factors that causes stress between the workers of the banks. the findings of this study show that there is no substantial difference according to the demographic factors in the level of stress at work. only the factors related to organization has a main significant relation with the work stress variables. the overall result shows that the work stress among the banking employees is moderate. another study (badar, 2011)finds the potential factors that create the level of stress and in what way they disturb the performance of bank employees in pakistan. the study shows that there is a responsibility of controlling the growth of stress which is lying on the shoulders of management as well as the employees themselves. heavy workload, long working hours, salaries, higher targets and technical problems are the main factors that affect the employee performance. both the manager and employees can manage and control their stress level by working together. on the other hand, the (m k. & renukamurthy, 2017)focus on find out the roots and outcomes of stress among the employees of banks. the researcher can study the stress management and how they affect the employee’s performance. for banking industry, the employee’s performance is the most important factor. the researcher finds that role conflict, lack of customer response and service for customers are the main elements that disturb the employee’s performance during their work. researcher reveals that stress can make an individual constructive and productive. according to the (sinha & sinha, 2018) the purpose of the study is to discover the organizational stress role between banking employee’s and to find the special effects of demographic variables on organizational role stress. it was found that the banking employees have neither very high nor very low organizational stress role. the organizational role stress among the banking employees is moderate. the maximum contribution of organizational role stress is role erosion, which is followed by role overload and inter-role distance. further it is found that work experience and income consume a significant influence on the routine of banking workers. (sharmila & poomima, 2012) identify that the banking sector face stress because of the pressure of work and work life balances. the organization would encourage all roles that support them to achieve their work and manage time for family. work life balance is the major part which contributes to stress among the employees. it is difficult for the management to develop successful performance for the employees. stress affects the employee’s performance that indirectly affects the organization because if employee cannot work efficiently it directly affects the organization. a study conducted in pakistan (awan & tahir, 2015)focus on find out the effect of stress and emotional intelligence on the employee’s performance in okara district. the researcher found that the stress does not disturb the workers performance positively. they can affect the performance of employees negatively in the banking sectors of okara. on the other hand, the researcher found that emotional intelligence has a positive influence on employee’s performance, and it is directly south asian review of business and administrative studies vol. 2, no. 2, december 2020 100 related with each other. when employees are under stress they can’t perform well. the more emotionally attached with the subordinates and boss the better employees perform. according to the (bashir & ramay, 2010) stress related to the job and job performance are harmfully correlated with each other. job stress reduces the performance of working employee. in the study, the employees do their job regularly but due to the workload and time constraint they reduce their performance. the result shows that the organization should provide the culture that is supportive within the atmosphere of working organization. management support helps the employees in reducing the stress level. (khan, khan, khan, khan, & khan, 2018)the researcher concluded that the harsh and negative attitude of boss, insufficient salary, heavy workload, and lack of co-operation are the major causes of stress amongst the employees. similarly, the sufficient work, reasonable salary, soft attitude of boss and co-operation are those strategies from which we can decrease the stress between the workers during their job. the researcher also found that the motivation, job satisfaction, appreciation, good working atmosphere and favor of employees on part of jobs are those strategies through which the stress can be reduced among employees. another study (das a. , 2016)conducted in bangladesh focus on find out the causes and effects of stress among the working women in banking sector. banking sector is one of the sectors that create stress among the women workers. the researcher found that dealing with the everyday activities, childcare, and viewing after the supporters of family are the major factors that causes stress among the working women in banking sector of bangladesh. on the other side, the efficiency of the employees is affected by the stress so that organization should provide positive work environment for the women workers. a supportive, energetic and positive culture should be established with in the institutions to motivate the working women. (ali, et al., 2011)focus on find out the effects of stress on workers performance. the result reveals that there is a progressive effect of stress on the performance of workers during their job. the workers do better work performance under the stress. it is also determined that there is direct progressive relation among the stress and the employee’s daily work as their performance include three dimensions which are efforts, skills and working conditions. all of these dimensions have a complete optimistic direct association through the independent variables of stress. on the other hand, the demographic factors such as age, gender and salary does not show any significant direct relationship with employee performance and stress. after learning the previous studies this study focuses on the features that create the stress in microfinance banking sectors. finally, theoretical framework of the study is highlighted in figure 1. based on the above discussion and framework given in figure 1, the current study proposed following hypotheses; ho1: there is a negative relationship between lack of motivation and employee performance. ho2: there is a negative relationship between the time pressure and the performance of employees. ho3: there is a negative relationship among workload and the employee’s performance. south asian review of business and administrative studies vol. 2, no. 2, december 2020 101 figure 1. theoretical framework of the study research methodology in this study, the impact of stress among the employees in microfinance banks has been explained and examined. for the determination of observing the impact of stress in microfinance banks, all micro banks of bahawalpur are examined. it also covers the population target, sample size, gathering of data and measurements of variables and procedures. to extent the numerous purposes of the study quantitative research process was employed. the research is established on primary data that is collected through survey questionnaire. data collection primary source is used for collecting the data. the primary data is collected through questionnaire. to compare the influence of stress of the work life of different workers in microfinance banks questionnaires has been used. the survey questionnaire was separated into dual parts. the first part contains demographic information and the second part covers the questions on the independent and dependent variables. the questions was adopted and adapted from the past research. measures in the study, the survey form was divided among workers for finding the impact of stress on the work life of employees. the likert scale exist to measure the answers that is; strongly disagree, disagree, neither agree nor disagree, agree and strongly agree. the employees are demanded to specify the opinions on the likert scale arrangement as of strongly disagree towards strongly agree. number of items according to the variables are given in table 1. table 1. number of items variables questions (no. of items) descriptive 04 lack of motivation 06 workload 05 time pressure 05 employee performance 06 findings demographic characteristics of participants time pressure workload lack of motivation employee performanc e south asian review of business and administrative studies vol. 2, no. 2, december 2020 102 the values represent that a large number of workers from this sample are female (52%) and (48%) are male. the values display in table shows typically more members (56%) remained in the age category of 20-35 as related to the further age categories. 36-45 are 33% and the age category started from 46-55 remains 10.5% and 55-above are .5% only. the level of position shows that majority of the participants are from middle level management that is (48%) and then from junior level management that is 38%. only 14% response rate is given from senior level management shown in the table. table 2. gender frequency percent valid percent valid female 52 52.0 52.0 male 48 48.0 48.0 total 100 100.0 100.0 table 3. age group table 4. toi type of industry frequency percent valid percent cumulative percent valid banking 100 100.0 100.0 100.0 total 100 100.0 100.0 table 5. lop level of position frequency percent valid percent valid senior level management 28 28.0 28.0 middle level management 46 46.0 46.0 junior level management 26 26.0 26.0 total 100 100.0 100.0 reliability analysis “reliability states that there is capability of the scales or the survey questionnaire to describe the feature and in what way these substances are associated with each other”. in order to find the inter frequency percent valid percent valid 20-35 56 56.0 56.0 36-45 33 33.0 33.0 46-55 10.5 10.5 10.5 55-above .5 .5 .5 total 100 100.0 100.0 south asian review of business and administrative studies vol. 2, no. 2, december 2020 103 consistencies; the method of cronbach’s alpha used. for the cronbach’s alpha the acceptable value is .70. lower than .70 the alpha is neither adequate because it displays that the internal consistency is low. the value of cronbach’s from scale is .907 which remains adequate shown in table. the value of the cronbach’s alpha indicates all these 22 items in the scale are reliable. this value is preferable. table 6. reliability statistics cronbach's alpha cronbach's alpha based on standardized items n of items .907 .907 22 correlation analysis correlation represents the relations among variables. correlation estimates the relations of all the variables between similar pairs of the variables. • correlation of workload with lack of motivation is (r= .581) shows the positive relationship and the p-value is 0.000. it is statistically significant and shows that there is 100% chance of it. correlation of workload with employee performance is (r= -.456) is negative relationship and the p-value is 0.000. correlation of workload with time pressure is (r=.674) is also a positive relationship and the value of p is 0.000. it also represents there exists a 100% chance of it. • correlation of lack of motivation with employee performance is (r=-.670) that is stronger negative association and the value of p is 0.000. it represents when the lack of motivation increases it will affect the performance of employees. correlation of lack of motivation and the time pressure is (r=.170) and the value of p is 0.000. it represents there is a complete100% chance of it and has positive relationship. • correlation of time pressure with employee performance is (r= -.474) which represent that there is negative relation but have the significant impact with the p-value is 0.000. it means that when time pressure increases the employee performance decrease. independent and dependent variables (iv-dv) correlation south asian review of business and administrative studies vol. 2, no. 2, december 2020 104 table 7. correlations wl lom ep tp wl pearson correlation 1 .581** -.456** .674** sig. (2-tailed) .000 .000 .000 n 100 100 100 100 lom pearson correlation .581** 1 -.670** .170** sig. (2-tailed) .000 .000 .000 n 100 100 100 100 ep pearson correlation -.456** -.670** 1 -.474** sig. (2-tailed) .000 .000 .000 n 100 100 100 100 tp pearson correlation .674** .170** -.474** 1 sig. (2-tailed) .000 .000 .000 n 100 100 100 100 **. correlation is significant at the 0.01 level (2-tailed). regression in this order, to explore relations among variables regression model is used. in the regression analysis the model summary gives the value of r, the r square, and the familiar adjusted r square and the standard error. adjusted r squared is the adjusted type of r squared which has been familiar for the numbers of researchers in the model. the result shows that the independent variables have a substantial influence on the dependent variable. the dependent variable shows that the value of p=0.000 is strongly statistical significant and shows that there is 100% chance of it. value of the adjusted r-square=.457 shown in the table represent that the independent variables consumes 45% influence on the dependent variable that is the employee performance. table 8. model summary model r r square adjusted r square std. error of the estimate 1 .682a .465 .457 .56559 a. predictors: (constant), lom, tp, wl b. dependent variable: ep anova the analysis of variance (anova) represent whether all the independent variables show the good job in explaining variation in the dependent variable or not. for this purpose, the significance value of f should have a value smaller than 0.05. anova is used to analyze the differences between group means. significance of the model is less than 0.005. south asian review of business and administrative studies vol. 2, no. 2, december 2020 105 the anova represents this model remains substantial (p < 0.0005). table 9. anova model sum of squares df mean square f sig. 1 regression 54.467 3 18.156 56.755 .000a residual 62.699 196 .320 total 117.167 199 a. predictors: (constant), lom, tp, wl b. dependent variable: ep conclusion agreeing to the consequences of the study, my study accepted the hypothesis 1 which stated that there is a negative relation among lack of motivation and employee’s performance. correlation of lack of motivation with the employee performance is r = -.670 which shows that there is strong negative relationship. increase in lack of motivation decrease the performance of employees. hypothesis 2 and hypothesis 3 is also accepted because both the workload and the time pressure have a substantial undesirable effect on the work life of workers. when work is too loading the employee, performance is negatively affected. when the workers have given too many responsibilities and are projected to complete within the time period, the time pressure increase which negatively disturb the performance of workers. according to the researcher (murali, basit, & hassan, 2017) time pressure, work load and the lack of motivation has a harmful influence on the performance of the workers. in these days it is essential to note that employees are not motivated. because of this lack of motivation affect the employee performance. this research only discusses the impact of stress in microfinance banks only. future studies should find out the level of stress in various other sectors. the exploration delivers assistance for the upcoming studies to discover numerous further concealed reasons of stress in banking sectors of bahawalpur. these researches should explore different professions, lines of effort and the attitude. taken together further field studies are needed to examine impact of stress in actual work environment as well as to uncover underlying mechanisms. the size of the sample should increase from 100. researcher should use the other social factors and environmental factors in his study. future research should use the moderating variables to study the effects of stress on the variables. several mediating variables should also add for finding the better results. references kishori, b., & vinothini, b. (2016, may). a study on work stress among bank employees in state bank of india with reference to tiruchirappalli. international journal for innovative research in science and technology, 2(12), 418-421. sharma, r., jauhari, s., & singh, v. (2015). stress techniques and management : a review paper. journal of literature, languages and linguistics, 13, 184-189. hamdan, y. (2012). work stress and its management: a practical case study. european journal of business and management, 4(18), 33-36. jarinto, k. (2011, october). understanding stress in multinational companies in thailand. international business research, 4(4), 153-163. murali, s. b., basit, a., & hassan, z. (2017, november). impact of job stress on employee performance. international journal of accounting and business management, 5(2), 1333 south asian review of business and administrative studies vol. 2, no. 2, december 2020 106 islam, s., rahman, m., reza, m., & rahman, m. (2014, june). factors causing stress and impact on job performance:a case study on banks of dinajpur, bangladesh. journal of science and technology, 85-89. priya, b., & soni, d. s. (2017, june). impact of job stress on the performance of the bank employees. international journal of science, environment and technology, 6(3), 18431851 charity, e. (2016). impact of stress on employee's productivity in financial institutions in nigeria. european journal of business and management, 8(19), 105-109 jayasinghe, c., & mendis, m. (2017, september). stress and job performance:a study on banking sector of northern region of sri lanka. international journal of research publications, 1(1). das, a. (2016). causes and effects of stress among working women in banking sector, bangladesh. badar, m. r. (2011, november). factors causing stress and impact on job performance,"a case study of banks of bahawalpur, pakistan". european journal of business and management, 3(12), 9-17. badar, m. r. (2011, november). factors causing stress and impact on job performance,"a case study of banks of bahawalpur, pakistan". european journal of business and management, 3(12), 9-17. m k., m., & renukamurthy, d. t. (2017, january). "stress among banking employeea literature review". international journal of research granthaalayah, 5(1), 206-213. sinha, d., & sinha, s. (2018). organizational role stress of employees in the banking sector. official journal of national research council of thailand in conjunction with abac journal, 4(1), 42-52. sharmila, a., & poomima, j. (2012, january). a study on employee stress management in selected private banks in salem. elixir international business management, 6555-6558. awan, p. d., & tahir, m. t. (2015). impact of working environment environment on employees productivity: a case study of banks and insurance companies in pakistan. european journal of business and management, 7(1), 329-345. bashir, u., & ramay, m. i. (2010, may). impact of stress on employee job performance; a study on banking sector of pakistan. international journal of marketing studies, 2(1), 122-126. khan, a., khan, a., khan, s., khan, s. u., & khan, m. k. (2018, january). causes and coping stretegies for das, a. (2016). causes and effects of stress among working women in banking sector, bangladesh. mediscope, 3(1), 1-7. das, a. (2016). causes and effects of stress among working women in banking sector, bangladesh. mediscope, 3(1), 1-7. ali, f., farooqui, a., amin, f., yahya, k., idrees, n., amjad, m., et al. (2011, november). effects of stress on job performance. international journal of business and management tomorrow, 1(2), 1-7. omollo, p. a., & oloko, d. (2015). effect of motivation on employee performance of commercial banks in kenya: a case study of kenya commercial bank in migori county. international journal of human resource studies, 5(2), 87-103. awan, p. d., & tahir, m. t. (2015). impact of working environment environment on employees productivity: a case study of banks and insurance companies in pakistan. european journal of business and management, 7(1), 329-345. saeed, d. r., mukhtar, a. m., sami, a., lodhi, r. n., mahmood, d. z., & ahmad, d. m. (2013). effect of emotional intelligence and stress on employee performance in banking sector : a case study of okara domestic pakistan. management and administrative sciences review, 2(5), 594-602. murali, s. b., basit, a., & hassan, z. (2017, november). impact of job stress on employee performance. international journal of accounting and business management, 5(2), 1333. south asian review of business and administrative studies vol. 5, no. 1, june 2023 17 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas marketing analytics implementation strategies exploration for organizational transformation at askari cement: a case study analysis dr. imran bashir dar, assistant professor, foundation university islamabad, pakistan muhammad naeem khan, assistant professor, university of central punjab, lahore, pakistan manzoor ali, ms student, riphah international university islamabad, pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords marketing analytics, askari cement, case study, organisational transformation marketing analytics is a strategic shift where companies need to explore and identify the managerial dynamics of marketing analytics in terms of the implementation strategies that are adapted or preferred by the management for transforming the organisation. this study is about the same in terms of a cement manufacturing company. as much of the research concerning the problem area is focused on it-intensive companies, this research endeavour would enrich the current research in terms of mapping the marketing analytics implementation strategies for organisational transformation in a developing economy. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: imran.bashir@fui.edu.pk doi: https://doi.org/10.52461/sabas.v4i2.1838 introduction marketing managers use analytics on all of these data streams to assess the anticipated business situation. marketing managers use data about environmental factors that are internal to the marketing discipline, such as projections of sales and product/service business growth, as well as external factors like political changes, to influence the firm's performance. this can pave the way for proactive planning for what is to come (cain, 1970; burt, 1978). one of michael e. porter's most popular works on competition and strategy, “the five competitive forces that shape strategy” (2008), which establishes the pivotal role of analytics and argues that without it, businesses cannot have the understanding required for competitive forces, provides insight into the significance of proactive preparedness. keegan (1983) and johansson and nonaka (1983), while highlighting the key strategic factors of japanese companies for their international success, projected the 5th marketing mix, known as a probe. to engage with the competitive forces, various field experts developed strategies in terms of different directions. a probe is a way to gather information on a specific topic and examine it to spot emerging trends. this helps the decision-making process, which is essential for marketing analytics strategies in terms of modulation and efficient reporting (daser, 1984; shaikh & https://journals.iub.edu.pk/index.php/sabas mailto:imran.bashir@fui.edu.pk https://doi.org/10.52461/sabas.v4i2.1 south asian review of business and administrative studies vol. 5, no. 1, june 2023 18 hanosotia, 1985). so, there is a need to research to know what strategies the managers have to develop and what initiatives they have to take to proactive preparation for insight-based decision making that could pave the way for new product development (aljumah et al., 2021), firm capabilities for marketing (cao et al., 2021), enhancement of marketing analytics strategies (gupta & tomar, 2021) for value creation that reaps competitive advantage (hossain et al., 2021) to untap the competitive-marketing-performance of the firm (rahman et al., 2021), as there is a clear link between marketing strategy and marketing analytics (sheth, 2021). so, the reflection of the above is carried forward in terms of the research question below: research question: how the marketing analytics is implementation through strategies adapted and preferred by the management at askari cement? case study as per the guidance from the work of benbasat et al. (1987), and yin (2009), which depicts that if the research problem is nascent and at the firm level as well as the research questions require the study of a company in real settings then the most appropriate and reliable course of research method is the case study. introduction of case as one of pakistan's leading cement producers, the first case company was chosen based on its operational and managerial system characteristics. two plants owned by askari cement are located in nizampur and wah. since its founding in 1921, the company has faced a variety of business obstacles and strives to provide clients with superior services and goods in order to leave a lasting impression. the plants' capacity has increased to 1,701,000 tonnes per year. exports assist afghanistan, south africa, and sudan. askari cement has benefited from fwo and nlc membership (information extracted from the interviews and company a website). according to a december 2020 pakistan stock exchange press release, askari cement is part of fftho, one of the top 10 conglomerates by total performance. organisational transformation need & marketing analytics the top management and senior officers have acknowledged the necessity for a reliable system for marketing analytics that could direct organisational operations and managerial capabilities to the point where the company might acquire a lasting advantage. the top management recognises the need for experts who can use marketing analytics to change the organisation. marketing analytics (ma) requires operational flexibility for future orientation in planning, where past data is significant but past practises call for a new perspective through better and actionable insights from the data-backed reports, which forecast the future opportunities and demands of change management. the highest level of management believed that: “marketing analytics is getting more important for every other business and even our competitors and we are looking for future prospects in the cement sector” a senior manager spoke on the significance of recognising future-orientation needs that: “previously we were working on having our standards and market targets based on the past 3 or more years of performance but now we are looking ahead as markets are changing and one can not only rely on past data” an executive replied: south asian review of business and administrative studies vol. 5, no. 1, june 2023 19 “it has been sensed by the marketing and sales department as well as related roles that the data is being under-utilised and lost in many cases. so, the need for having systems for organisational transformation and personnel capacity building for managing the new systems is inevitable” “the old it policy and processes, the information systems as well as the work routines were costly and the need for transformation was sensed by the top management” consequently, readiness for the upcoming disruption in the industrial sector refers to the transition from current practises to a focus on anticipated market changes and trends. as mechanisms are not yet in place and the organisation lacks personnel who might examine the reports in terms of operational capabilities, this trend is still in its early stages. contrarily, each manager's meeting would be lacking without the use of an integrated database to reference the reports and the discussion of these reports in terms of managerial issues. the necessity is thus made clear by the managers' demands for data-backed meeting sessions. the senior management most likely instructed the need assessment and recognition step as follows: “the management gives much importance to data-backed decisions and there is not a single meeting that i have attended where readily available data is not presented for future trends assessment” two senior managers provided the following illustrations of the requirement for diversified reporting and planning: “the importance of marketing analytics is visible now when we need multiple diverse reports for marketing and operations” “actually, we have to be locally fit and prepare for future challenges and foreign markets” one of the it professional offered the following perspective on how the transition from marketing intelligence to marketing analytics (ma) connects the requirement with planning and readiness: “it department is fully capable to provide service for it. marketing analytics is more demanding as real-time data upgrading and relational databases, new reporting techniques and information management, as well as system and cyber security, are needed. static data is used for intelligence whereas dynamic is used for analytics” the context, roles, and necessity of transformation at organisational level by using ma deploy the readiness for the nest stage that is planning, which deals with developing strategies for the changes (second-order) at organisational level. figure 1: silos-automation to transformation south asian review of business and administrative studies vol. 5, no. 1, june 2023 20 planning as there was a transition from siloed reporting to integrative reporting and processing mechanisms, the askari cement underwent a planning phase that lasted for around 6 months. the requirements for operational domain are sought from all the heads of departments to have agreement on the end product. response from the assistant marketing manager: “before 2004, askari cement was manual and many of the departments were using softwares in silos. this was costly as all the departments at various stations were managing it teams and it infrastructure on their own and reworking were being done many times due to a lack of integration amongst the different offices and workstations across pakistan and the head office at rawalpindi. so, the priorities set for the planning phase were integration of the offices across pakistan for having any kind of report be some clicks away. this took hours of meetings with the vendors of the softwares and different stakeholders, along with the consolidated presentations at the head office (fftho)” the preparatory phase included talks with askari cement's executive management and fftho authorities. an executive's preparatory reaction: “there were softwares at the departmental level, but they were not effective and hampered the timely reporting of the status for any ‘metrics’ so planning was focused on the development of an integrated software suite that would enable any of the officers to check the status of anyone factor or interdependent factors by just running some queries or by any other mechanism that would be cost-effective in terms of time, human error, and demand for readily available reports” primary responsibilities and value-added tasks are "basically" the yardsticks. this demonstrates that both lower and upper management were on the same page with regards to integrated system planning, which could make what has been mentioned in the preceding paragraphs possible. the strategic plan was discussed at length by upper management and the leaders of sales, marketing, it, and other departments, with particular attention paid to the following points: ✓ job descriptions at the marketing & sales department (m&s) that involve interdisciplinary work and tight collaboration with the it, export, and other departments. ✓ the enterprise resource planning (erp) system requirements of the business and market possibilities for system deployment, consulting, and service level agreements ✓ using approved central budgeting to provide resources for it infrastructure, new hires, and a number of training initiatives ✓ conflicts between departments that are anticipated to occur after and during the deployment of the integrated system; anticipated multi-layered results, advantages, and obstacles ✓ organizational transformation plan and related marketing analytics and metrics projects and strategies require approval from the fftho and must be reported on in a variety of ways. the plan had the proceeding main goals of strategic nature: to equip marketing and sales and other cross-departmental groups with the means to monitor key performance metrics: ✓ value-based integration of logistics, operations, marketing, and other functions allows for proactive customer relationship management planning. south asian review of business and administrative studies vol. 5, no. 1, june 2023 21 ✓ reports in "real time," tailored to the requirements of both annual meetings and impromptu gatherings when choices must be made quickly. ✓ multi-staged systems for monitoring the finalisation of deals and the preparation for auditing, fraud, and problem identification. figure 2: planning cycle of integrated system (major considerations) initiatives for implementation: strategies and management the ways that marketing analytics and metrics projects are put into action are based on the need for change, planning, and the most important marketing analytics metrics. concerned roles and responsibilities that cross disciplines askari cement now has seven (7) people in management positions. together, they make up a fullfledged marketing and sales department (m&s), which has roles that span different fields and often overlap with the export and it services departments. the m&s team collaborates closely with it, who employs a tailored erp to link logistics, marketing, and other functions as required by issues and routine business. talking about how the m&s department was made up in detail, which we learned from the interviews, there was: ✓ manager sales & logistics reports to the assistant manager sales & logistics, who works with the logistics team and other managers to answer sales-related complaints, engages clients by giving them logistics and other services, closes deals, and tracks customers up to third parties. ✓ the general management initiatives, concerns, plans, and corrective actions for the sales and logistics operations—including market competitiveness, price competition, legal challenges, and similar matters—are handled by the manager of sales and logistics. ✓ manager marketing focuses on the organization's various brands, branding tactics, social welfare, cost reduction, and clever logistics. ✓ for the purpose of developing sales strategies, the senior manager marketing provides reports to the gm marketing on regional and area-specific sales, business financial and non-financial performance tracking, and audit preparation. south asian review of business and administrative studies vol. 5, no. 1, june 2023 22 ✓ smart system for managing conflicts, generating sales leads, finalising deals, and tabulating database information for daily approvals. keep an eye on sales leads for your product and service portfolio as a manager of marketing and operations. ✓ manager of institutional sales managed the intricate and multifaceted b2b operations and business account interactions. ✓ the gm marketing performed his leadership duties and offered a framework for the integration of diverse functions for comprehensive planning and operational preparation. in “tight coordination” with the m&s department, manager export also takes on the export promotions and is given the duties connected to getting ready for upcoming challenges and international markets. it is noteworthy to note that one of the senior managers, when discussing the operational tasks of the jobs outlined above, expressed the viewpoint that “all the duties and responsibilities under each title were incomplete without the support and assistance from the erp systems”, because they argue that marketing analytics and metrics are both the greatest obstacle and greatest opportunity in the industry right now. this brings up the position of the it manager, “who was in constant collaboration and contact with the marketing department for delivering the digitalized system platform” for a wide range of business procedures, with a focus on continuous improvement via testing, tweaking, and implementing new ideas. in order to manage the total organisational transformation brought about by marketing analytics, it is crucial for it and other departments, particularly marketing, to work closely together. figure 3: marketing & sales department (interdisciplinary roles) real-time reporting and is management's objectives and goals stand out due to the priority they give to reporting based on continuously updated consumer data that is made available to all relevant quarters. in terms of marketing, sales, and logistics, it assisted management in making the business run more smoothly. the direction from management on how to mesh among departments is crystal clear: “our communication, sales and logistics, and other operations are connected to analytics mechanisms through our customised erp” customer centricity and management priorities for value addition the management representatives in charge of sales and logistics believed that: south asian review of business and administrative studies vol. 5, no. 1, june 2023 23 “we at askari cement are striving hard to modernise our company structure to make it more customer-centric and based on readily available information to convert it into knowledgeable and decision-supporting reports” gm marketing spoke about the main areas of concern about marketing analytics and metrics projects: “the opportunity in having new services, better product ranges and business contracts as its the area where much value addition can be done through marketing analytics and metrics” additionally, some of the significant endeavours in this area include: ✓ membership in organisations that promote environmental and social awareness, best practises for the industry, and customer relationship management ✓ customer-centricity is prioritised by management in a number of decisions. ✓ distributing the benefits of marketing analytics to retailers and consumers, and motivating retailers to boost sales additionally, the main areas where the objectives and strategies were plugged in include tax management and real-time tracking of sale activities. price packages and customer life cycle business-to-business and business-to-consumer pricing packages are developed utilising integrated reports and data-backed estimates, and then given to clients and dealers based on the customer life cycle and previous business trends. according to projections: “we are working on bifurcating our brands and setting price packages in terms of the customer life cycle (clc), which is part of our overall market expansion strategy. the clc report is one of the major documents that is sourced from our modernised is” the establishment of marketing analytics measures that the business might evaluate, and audit is made possible by the marketing initiatives and strategies. these marketing analytics indicators serve as further benchmarks for the cement industry and lay the foundation for locally available competitive edge sources that may be challenging to replicate. therefore, progress requires a comprehension of marketing analytics metrics. discussion cement manufacturing companies require digital transformation for better firm performance (adjie eryadi et al., 2020). so, the firms need to first recognise the need for transformation and link it with performance. this recognition results in the form of deficiency identification that inhibit market competitive advantage. the theoretical paradigm of rouse (2005) projects the identification of value deficiencies for the organisational transformation by focusing on the processes, people and technology that are needed for the transformation. rouse (2005) basically talks about the “how” of digital transformation. the digital transformation was recognised by the senior management, which triggered a series of meetings for planning for the digital clone of the current functions and moving towards the new process, which is a challenging situation. for this purpose, askari cement's marketing department was at the forefront of this movement as data-driven decision-making was the target of the management, which the backing of actionable insightful reports generated through the utilisation south asian review of business and administrative studies vol. 5, no. 1, june 2023 24 of marketing analytics capabilities. this has been argued by liang et al. (2022) that marketing has to come to the forefront in terms of digital transformation. the management all agreed that, because of the change in the market, the competitors were also looking for ways to build up similar skills (adjie eryadi et al., 2020; dutta & bose, 2015). it was thought that digitalized services offered through apps and online platforms would have good future prospects and also need to promote export. literature backs up this point of view and goes so far as to say that functional marketing analytics must be integrated smoothly from the shop to the top management level for business analytics to pay off (ibm, 2012). this is one of the problems the company faces, as it has been seen that the management part of the marketing analytics operations has been more important than the non-management part (engineering). wheeler (2002) shows that this mistake shows that long-term planning from a broader perspective of marketing analytics is needed, and that holistic and rigorous application is what is needed right now. the rouse theoretical position says that a deep understanding of digital transformation is a difficult task that needs a long-term view and the participation of all stakeholders. askari cement's marketing analytics implementation is characterised by the incorporation of logistics and other cross-functional operations necessary to monitor and analyse customer lifecycle, business history, consumer stage business patterns, multiple report projections, and realtime business account status. these actions were taken in order to lay the foundation for future management efforts and strategies. to better manage business projects, steer change management in the appropriate direction, and shift attention to supply and tracking systems are the primary objectives of the initiatives and strategies. cement industry case studies by researchers like adjie eryadi and nizar hidayanto (2020), trinoverly et al. (2018), dutta and bose (2015), and bhattacharya and saha (2017) demonstrate this (2015). limitations and future research this research work is extracted from the doctoral dissertation of the first author and an effort has been made to provide as many relevant research studies as possible but there could be any that are left unintentionally. the critique in the literature has been avoided as the area is at a nascent stage and a lot of work is already needed to be done to provide a generalised definition of marketing analytics, as well as define the best practices in terms of the implementation of marketing analytics for organisational transformation. there is a dire need to do further research in terms of retail companies, the banking sector, chemicals and companies working under the conglomerate umbrella. conclusion it is evident from the current study that marketing analytics implementation strategies for organisational transformation require interdisciplinary roles, reengineering of marketing policies and re-structuring of the marketing department. the recognition of the need for organisational transformation, planning in detail about the major challenges and having future orientation accordingly, and carefully crafted strategies for implementation that pave the forward for customer centricity and readiness in terms of technology, employees and culture are critical. references adjie eryadi, r., & nizar hidayanto, a. 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(2009). case study research: design and methods (4th ed.). thousand oaks, ca: sage. south asian review of business and administrative studies vol. 5, no. 1, june 2023 26 south asian review of business and administrative studies vol. 1, no. 1, june 2019 13 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.1, june 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas impact of service quality on tourist satisfaction and destination loyalty at fort munro, pakistan hina hameed, department of management sciences, the islamia university of bahawalpur, pakistan. kalsoom akhtar, department of management sciences, comsats university islamabad, pakistan. article details abstract history revised format: may 2019 available online: june 2019 keywords tourist satisfaction, service quality, behavioral intentions, destination loyalty tourism industry plays a significant role in the economy of any country. in classify to enlarge the quality of tourism, this sector needs to know what their competitive advantage is and what potential they require to raise and prolong. the basic intention of this study is to examine tourist satisfaction in the tourism area in order to highlight the need for better service quality. the tourist pleasure is one of important factors as tourists apply to determine quality of service which play an important role in future behavior intentions and destination loyalty and that are intimately connected with their pleasure. that research was quantitative in nature. a standardized questionnaire was used to gather data for the analysis. the study's findings were analyzed using a reliability measure, correlation, and regression analysis. according to the findings of this report, service quality has a huge effect on visitor happiness, and as a result, service quality plays an important role in tourism. the findings showed that service quality does have a positive impact on tourist satisfaction, and that tourist satisfaction has a positive impact on potential behavioral intentions and behavioral intentions. this research offers a variety of theoretical and decision-making recommendations to the academic and tourism sectors focused on the findings. the writer offered suggestions and shortcomings for future study. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: heena_ayaz07@yahoo.com doi: https://doi.org/10.52461/sabas.v1i1.445 introduction in today's global environment, any company must contend with increased competitiveness, including such strategic advantages, sustainability, and efficiency gains, in order to distinguish oneself from the competitors. as a result, in the economy, quality service is critical to a country's economic growth. furthermore, enhancing service quality boosts consumer loyalty and engagement, growth, and financial results thereby lowering sales and operational costs. (khan et https://journals.iub.edu.pk/index.php/sabas mailto:heena_ayaz07@yahoo.com https://doi.org/10.52461/sabas.v1i1.445 south asian review of business and administrative studies vol. 1, no. 1, june 2019 14 al., 2014). in the extremely viable tourism diligence, tourism is observed as dynamic vigor for area expansion. flourishing tourism is capable of increase earnings, job opportunities and also government returns of any country. providing the high service quality can increase the tourist satisfaction level and it becomes a key factor for sustainable tourism purpose administration (liu and yen, 2010). on the other hand, it can be able to exert a pull on tourists to visit again and advocate intention to others is other significant element to make an accomplishment of tourism aim expansion (chen and tsai, 2007). pakistan is home to several of most amazing tourist attractions in the world. with the attractive topographical features, it’s a country that enjoys all four seasons and has been recently recognized as the world’s top tourist destination for 2020. it has largest deserts, lush green fields and wonderful hill stations. pakistan’s punjab province is also a land with astonishing natural variety. fort munro is one of most stunning hill station in pakistan, is one example that wholly reflects the natural diversity of province. that hill station located at a height of 1,972 m (6,470 feet). fort munro is one of the coldest places in the region, which also experiences snowfall every now and then, and is often dubbed as “mini murree” by the locals. it is visited by a large number of tourists, mostly during the summer season to escape the heat. with over 6000 ft of elevation, fort munro is the highest point of the koh-e-suleman mountain range, which is why it is often considered as the ‘jewel’ of southern punjab. keeping in view its significance in the world of tourism, the current government is doing efforts to make it a fully-fledged tourism spot by adding features like cable car and chairlift system as well as developing new infrastructure projects in the region with the provision of other basic facilities for people visiting the hill station. until now, the standard of facilities and their effects on tourist happiness have not been assessed in the chosen context. the tourism sector remains one of the most important industries in this current and competitive age, and amid major developments that have rendered its operational climate more challenging, the tourism sector continues to develop (theobald, 2005). the world travel and tourism council reported that (2009), the tourism industry has raised a gross income of u.s. 3.5 trillion dollars and it forecast to boost u.s. 7.0 trillion dollar by 2011(salleh et al., 2013). the study on the service quality, tourist satisfaction and future behavioral intentions are well perform in extent of tourism prose (cole and illum, 2006). however, research did not been effusive subjected to theoretical and observed analysis in the intellectual tourism perspective mainly in fort munro pakistan. therefore this study aims to analyze control of service quality and tourist satisfaction on the behavioral intentions and destination loyalty in fort munro pakistan. that study is ordered in the five main sections which starting with the introduction of study. the next section provides a specific inclusive insight of literature on service quality and customer satisfaction, along with behavioral intentions and designation loyalty. next section explains in detail research methodology and section four detailed analysis results. the preceding section concludes study which is pursuing by discussion of useful implications and limitations of study. literature review service quality and tourist satisfaction service quality is definite as what customers gets out and be ready to give for it relatively than what the giver puts in (ducker, 1991). basically service quality must initiate from desires of buyers and ends with customer satisfaction and constructive awareness of the service quality. both customer and the service giver have a considerable control on the conception and delivery https://www.zameen.com/blog/hidden-tourist-destinations-pakistan.html https://www.zameen.com/blog/pakistan-tops-list-best-holiday-destinations-2020.html https://www.zameen.com/blog/most-popular-hill-stations-pakistan.html south asian review of business and administrative studies vol. 1, no. 1, june 2019 15 procedure of a service consequently the service was clear the diverse (kvist and klefsjö, 2006). according to while zeithaml et al (1996) service quality is generally notion of customers to the service flaw or else superiority. apart from the many definitions of service quality a variety of definitions of service quality contain the similar outlines like service quality is concerning with reference to the prejudiced judgment of customer of a service offered by contributor, according to that the space among customers anticipation and practical insight of the service (liu and yen, 2010). furthermore the stage of satisfaction will be attained if the anticipated level of service is alike to the supposed service. customers will be much pleased if the gap linking the anticipated service and perceived service is associated little. therefore, services are most important element of the tourism experiences especially the service quality is most significant feature to gratifying tourists. still, there are limited shots to study the association between the service quality and satisfaction in tourism business. hence it proposed a strong association between service quality and tourist satisfaction. h1: there is a significance link between service quality and tourist satisfaction. tourist satisfaction and behavioral intentions the term customer satisfaction may be is explained as the satisfaction based on the effects which distinguish the satisfaction level as the end state ensuing from the knowhow of utilization, or else a procedure with the aim of to highlight the perceptual, evaluative and psychosomatic procedures contributing to customer satisfaction (varvara, 1997).it can also be defined as the feelings of the post consumption that the customers practice from their purchase (um et al., 2006). tourist satisfaction is explained as the key findings of clients by assessing the tourism service (bowen and clarke, 2002). tourist satisfaction can be a significant issue intended for negotiations in the literature of tourism. the term tourist satisfaction is very significant for the target of marketing as it is primary in the preference of destinations, the spending of the products and the services, and the tourists’ decision to revisit (kozak and rimmington, 2000). in the literature of tourism the satisfaction of customer is the tourist state of sentiment after which they practice their excursion (sanchez et al., 2006). tourist satisfaction is imperative factor which being explored in loads of tourism studies due to its magnitude in formative the sensation and sustained survival of a tourism business (gursoy et al., 2007). the purpose of the vacation of tourist contentment is degree of on whole pleasure that the tourists experience, and effect that the visit experience capable to accomplish the tourist wishes, hopes, desires and wishes from visit (chen and tsai, 2007). behavioral intentions can be of great significance to service providers as they predict the behaviors. but some researchers are of the view that behavioral intention do no predict behavior accurately (brady and robertson ,2001).in the model presented by zbp (1996), repurchase intention, customer loyalty, complaining behavior, price sensitivity and word of mouth all measure the concept of behavioral intention. behavioral intention can be seen when the customer gets high service quality as perceived by buyer which direct to encouraging behavioral intention where as stumpy service quality perceived by the buyer results in unfavorable behavioral intentions. some researchers disagree that service superiority being a positive cognitive valuation, is the antecedent of customer satisfaction leading to behavioral intentions while other groups of researchers support the view that customer satisfaction leads to service quality (brady and robertson, 2001). in case, the customer, being cognitive oriented, will perceive service quality leading to customer satisfaction but if the customer is affective oriented, his perception of the relationship will be, satisfaction causing service quality. most of the researcher agreed on that service quality and customer satisfaction has undeviating associations with behavioral intentions (dst, 2000). on the basis of above argument, we come to hypothesize: south asian review of business and administrative studies vol. 1, no. 1, june 2019 16 h2: tourist satisfaction mediates the connection between service quality and behavioral intention. tourist satisfaction and destination loyalty in the field of tourism sector, there are observed indications that the satisfaction of a tourist have a burly sign of their objective to repeat and proposed the objective to the new people tourists (yoon & uysal, 2005). it is accepted that the satisfied tourists will revisit the unchanged destination, and are much eager to split their optimistic roving occurrences with the friends and family. there are many previous studies that detail a direct and affirmative association between the visitor/tourists satisfaction and service quality (osman and sentosa, 2013).it is additionally confirmed to there is an optimistic association between the visitor satisfaction and destination loyalty. yet that type of the studies has not account on the significance of the diverse stages of the sightseer satisfaction as a mediating manipulate in ascertained the association between the service quality and destination loyalty. hence the discussion proposed following hypothesis: h3: the tourist satisfaction mediates the association between the service quality and destination loyalty. framework research methodology the study used a quantitative research method. the data were gathered through the use of selfadministrated questionnaires distributed via face-to-face contacts. 100 respondents from bahawalpur city were contacted and a total of 90 completed the survey due to covid -19 the sample size was small. after the collection of fulfilled surveys the questionnaires were coded and go through into spss sheet for advance analysis. that research used convenience sampling techniques which are also known as accidental sampling by gather the samples from the tourist who visited to fort munro. a regularity examination was executed to review the allocation of various variables based on the demographic information like respondent age, sexual category, education, profession and common expenditures. table 1 of the study shows demographic character of the respondents. table 1: demographic characteristics variable sort frequency percentage gender male female 12 28 30 70 behavioral intentions service quality tourist satisfaction destination loyalty south asian review of business and administrative studies vol. 1, no. 1, june 2019 17 age 20-30 30-40 40-50 50-60 33 5 1 1 28.5 12.5 2.5 2.5 education intermediate bachelor masters ms/m phil 2 7 15 16 5 13.5 37.5 40 income(rs.) below 15,000 15,000-25,000 25,000-35,000 35,000-45,000 above 50,000 18 7 7 7 1 45 17.5 17.5 17.5 2.5 sample/data the researchers usually used 5% edge of error and the existing study also used the matching criteria. for the current study the response rate is projected to 85%. the sampling technique which we used was convenient sampling and non-probability sampling. it is that type of sampling where some elements of the population have no possibility of selection or else where the probability of selection can't be exactly determined. that technique involves the medley of elements based on the supposition concerning the population of concern, which forms the criteria for selection. although convenience sampling is a statistical tool for obtaining representative results by choosing individuals based on their willingness to volunteer or units based on their availability or ease of access. convenience sampling is often used to quickly and cost-effectively gather a vast number of successful surveys (lym et al., 2010). measures of the constructs first section of the scale was designed to include the demographics of the respondents consisted of sexual category, age, earnings and educational level. the section 2 of the study includes the latent variables which are imperative in the existing study. the study includes the variables as tourists satisfaction, destination loyalty, behavior intentions and service quality. all the items which used in the current study are adapted from the well known studies. the questionnaire of the study included 23 items (table 2), which are service quality (6 items), tourist satisfaction (8 items), behavioral intentions (4 items) and destination loyalty (5 items). all the items were scored on a five-point likert scale which are 1 for “strongly agree”, 2 for “agree”, 3 for “slightly agree”, 4 for “disagree” and 5 for “strongly disagree”. all measurement 23 items derivative from each construct and its cronbach a value have been listed for reference. the cronbach a value is well attained by all instruments ahead of the recommended level of 0.60 (nunnally, 1960) shown in table 3. south asian review of business and administrative studies vol. 1, no. 1, june 2019 18 table 2: items for variables no . variable items adapted from 1 tourists satisfaction 1. magnetism of the destination place 2. friendliness of the local populace 3. sightseeing staff treatment of tourists and local populace 4. the reasonability of opening fee to desirability sites 5. excellence of information accessible at magnetism sites 6. protection and safety of the target place 7. convenience of the target destination 8. accommodation da costa mendes et al., 2010; 2 destination loyalty 1. if i have to trip over again, i would prefer this place 2. i try to use this place because it is the best choice for me 3. i deem for myself to be a loyal client of this place 4. i will speak constructive things about this place to other community 5. i will suggest this place to someone who seeks my recommendation kim and niehm (2009) 3 behavioral intentions 1. if i had to decide again then i will want again this protected area 2. i will advise the practice of ecotourism to relations and links 3. i will speak highly of this protected area to family and friends 4. i will almost certainly recommend this protected area to family and friends 5. i would repeat the visit to this protected area on a different circumstances žabkar et al.(2010) 4 service quality 1.fort munro is consistent in creating a common sense comfort for you 2. fort munro people have rapidity and hospitality in serving you 3.hotel management provides the information and instructions that are easily understood by you 4.you will experience calm and protected during your visit in fort munro 5. the environment around fort munro is clean and neat 6.public facilities that are provided is well managed parasuraman et al (1990) reliability analysis the cronbach’s alpha value of tourists satisfaction of questionnaire was 0.94 which is supplementary than satisfactory value which is almost 0.50 by nunnally (1970) and 0.60 by moss et al. (1998). this value shows that all the 23 items of the questionnaire are highly reliable and valid for the purpose to calculate the opinions of tourist’s satisfaction in the tourism industry. south asian review of business and administrative studies vol. 1, no. 1, june 2019 19 table 3: reliability test: variables no of items cronbach alpha tourists satisfaction destination loyalty behavioral intentions service quality 8 5 4 6 0.94 0.92 0.92 0.89 data analysis and results: research hypothesis testing after testing the reliability of data gathered by using cronbach’s alpha, the proposed relationship among the tourist satisfaction, service quality, destination loyalty and behavioral intentions are tested in this section of the research study. the model is evaluated using linear regression relationship among, service quality effecting tourist satisfaction, tourist satisfaction effecting destination loyalty and tourist satisfaction effecting behavioral intentions. the descriptive study was conducted to validate relationships existing among independent and dependent variables. the correlation analysis was conducted in order to determine the strength of statistical relationship among variables is conducted as a supplement to the regression analysis. service quality and tourist satisfaction the results of regression conduct among service quality and tourist satisfaction give the value of (β=0.424) and p<0.01 .hence on basis of research findings we accept the h1 and validate that here is significant as well as a positive relationship between tourist satisfaction and service quality. further, the correlation results also support the research findings that both variables are positively and strongly correlated. tourist satisfaction and behavioral intentions regression analysis which conducted by using spss software version20 confirm the proposed relationship between the customer satisfaction and behavioral intentions under hypothesis. value of (β=0.682) and p<.001 prove the existence of a highly significant and positive relationship among the two variables. the correlation analysis also validates this relationship and show the satisfaction of customer has a very strong association with behavioral intention. table given below summaries the above regression results conducted under this study. tourist satisfaction and destination loyalty the present study attempts to evaluate effects tourist satisfaction can have on the destination loyalty. the regression investigation show that (β=0.602) and p<0.001, there is a considerable positive association among tourist satisfaction and destination loyalty as proposed in the model under h3 hypothesis. the correlation results also show the high strength of relationship existing among these variables as compared to the relationship among others. hypothesi s variables of study estimates s.e p results south asian review of business and administrative studies vol. 1, no. 1, june 2019 20 h1 service quality tourist satisfaction .424 .117 ** supported h2 tourist satisfaction behavioral intentions .602 .165 *** supported h3 tourist sat destination loyalty .682 .0139 *** supported table 4: regression analysis results where * p<0.005, **p<0.01 and *** p<0.001 table 5: correlation matrix tourist sat destination loy behavioural intentions service quality cus. sat cus. loy. beh. int. ser. qul. 1 0.062*** 1 0.682** 0.424** 0.719** 0.509** 1 0.571** 1 notes: **correlation is significant at the 0.01 level (two-tailed) discussion and conclusion the statistical investigation and empirical findings of the study need support that there is an influence of service quality on tourist satisfaction, as well as influence of tourist satisfaction on the future behavioral intentions and destination loyalty. these result findings also support the theoretical background used in this study. the tourist satisfaction can measured to be one of the most significant analysts of potential behavioral intentions. hence it is extremely significant to recognize that how tourists assessment their understanding in destination. it is important for the tourism management to formulate the most effective strategies and service freedom to assemble the actual needs of tourist. once the traveler recognizes the practice important, the level of satisfaction will take place and also the remuneration of constructive behaviors in potential possibly will achieved. managerial implications the present study exposed that service quality has a high pressure on the tourist satisfaction as compared to the other factors. hence, fort munro tourist management should develop and improve tourist satisfaction by performing a periodic post-evaluation from each service quality element that is still far from the needs and aspirations of tourists. the aim of enhancing service quality is to ensure that visitors enjoy the benefits they need while visiting fort munro. providing a good service quality is significant but not good enough for fort munro tourist management to south asian review of business and administrative studies vol. 1, no. 1, june 2019 21 rely just on service quality to raise tourist satisfaction that creates positive future behavioral intentions. other factors such as transportation and convenience, destination attractions and tourism promotion were measured need to be noted due to those factors that also play a significant function in the sensation of tourism business. although need of fort munro tourism management on improving of all the service quality aspects to raise the willingness of domestic local tourist to achieve behavioral intentions in the future. the tourism management at fort munro offers organized training programs for staff and tourists that are thought to have a significant advantage in terms of knowledge. the educational programs are structured to enhance the intensity of the ability and willingness to offer the greatest possible service to visitors. limitations & future directions of study as the results of the study drop light on the numerous imperative matters but still some limitations require to be measured. the present study has discussed the limited dimensions of quality service and customer satisfaction. the future researchers will investigate that dimensions. due to limited resources and time constraints, this study is limited on number of samples, consequently the future studies must enlarged the size of the sample in which respondents consist of combination between domestic local tourist and foreign tourists. thirdly, this study is limited on quantitative approach; therefore, it is recommended that further studies can be developed by combine research methods i.e. quantitative and qualitative approaches. references: bloemer, j., ruyter, k. and wetzels, m. 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(2005). an examination of the effects of motivation and satisfaction on destination loyalty: a structural model. tourism management, 26(1), 45–56. zeithaml, v.a., bitner, m.j. and gremler, d.d., 2009. services marketing: integrating customer focus across the firm. 5th ed. new york: mcgrawhill. http://www.robertniles.com/stats/ south asian review of business and administrative studies vol. 4, no. 1, jun 2022 75 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas the effectiveness of china-pakistan economic corridor in pakistan: local citizen’s perspective sitara bibi, the islamia university of bahawalpur, pakistan dr. warda najeeb jamal, durham university, england article details abstract history revised format: may 2022 available online: june 2022 keywords cpec, employment opportunities, poverty reduction, income generation, lesseducated citizens, local citizen’s attitude the purpose of this research was to investigate the effectiveness of the china-pakistan economic corridor (cpec) concerning reducing unemployment and poverty by creating employment opportunities for the less educated citizens of pakistan. convenience and snowball sampling techniques have been used for data collection. the target population was the less-educated citizens of pakistan. the results of the study reveal that the development of cpec is potentially effective for pakistan, in terms of creating employment opportunities for the less educated citizens, and reducing poverty. however, people living in rural areas are less educated and unskilled. they need to be well trained to avail of particular job opportunities. hence, the research implies that the government of pakistan should introduce skills development and training programs for the less educated community of pakistan to polish their skills for the particular job opportunities which arise due to different mega projects of national and international nature, such as cpec. this may lead to the reduction of poverty. moreover, the study found that cpec is significantly important for both nations particularly pakistan as it needs more to overcome social and energy crises as well as for economic development. therefore, the findings of this research are significantly important for the government officials, regulators, and policymakers, as it suggests them to consider and invest in the training and development of the less educated community of pakistan, to attain the maximum from such projects as cpec. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: rameenawan77788@gmail.com doi: https://doi.org/10.52461/sabas.v4i1.1033 introduction as a developing nation, pakistan has numerous obstacles, including economic and non-economic issues, high tax rates, education, low-skilled workforce, technology, infrastructure, and inadequate residential assets (ahmed, arshad, mahmood, & akhtar, 2017; kanwal, pitafi, et al., 2019; khan, 2007). to overcome these issues, the government of pakistan is designing multiple development projects that may boost up the economy of pakistan. one of them is china pakistan economic corridor (cpec) (kanwal, pitafi, et al., 2019; uddin ahmed, ali, kumar, malik, & memon, 2019). https://journals.iub.edu.pk/index.php/sabas mailto:rameenawan77788@gmail.com https://doi.org/10.52461/sabas.v4i1.1033 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 76 officially, cpec was inaugurated by the president of china xi jinping in april 2015 with a total worth of 46 billion us dollars (ahmed, arshad, mahmood, & akhtar; zhao, 2020). cpec is a proposed megaproject that will link the pakistani port of gwadar to the chinese city of kashgar (china). china has been interested in improving the infrastructures between pakistan and china for decades, thus the proposal of cpec is not a surprising development (ali, mi, shah, khan, & imran, 2017; asomani-boateng, fricano, & adarkwa, 2015). this is the mega project of whole south asia that is directly linked with pakistan and china (ali, mi, shah, khan, et al., 2017). this project is enjoying full support from the governments as well as the people of china and pakistan as it gives benefits to both countries (ali et al., 2018). china sees this mega project as a historic initiative (kanwal, pitafi, et al., 2019; kanwal, pitafi, rasheed, pitafi, & iqbal, 2020). china pakistan economic corridor (cpec) is a flagship project and it will help to generate employment opportunities and boost the economy of pakistan (hussain, 2017; uddin ahmed et al., 2019). the current study was conducted to examine the effectiveness of china pakistan economic corridor (cpec) in terms of reducing unemployment and poverty by creating employment opportunities and generating income for less educated people of pakistan. surely, this mega project is the most important opportunity for pakistan which will help to reduce poverty and improve the living standards of its population by providing them employment opportunities (asomani-boateng et al., 2015; uddin ahmed et al., 2019; xiguang & lizhou, 2015). the practical implications of this study are to provide insights about the effectiveness of cpec to policymakers and the government of pakistan so that they may take initiatives to improve the policy and support this mega project for the welfare of the less educated poor people of pakistan. this research contributes to the existing literature of cpec in a way that provides clear insights about how cpec is working for the welfare of less-educated poor people of pakistan. our findings confirm the effectiveness of cpec in terms of reducing poverty by creating employment opportunities for the less educated poor community of pakistan. this study is divided into 4 sections. section 1 and 2 provide an introduction and review of the literature. the 3rd section includes mythology and analysis of the variables used in the study. the 4th and last section give a conclusion with detailed discussion and implications of the study. literature review and hypothesis development china pakistan economic corridor (cpec), a mega project is initiating many different small projects including power, infrastructure, and economic zones in pakistan (babar & zeeshan, 2018; khursheed, haider, mustafa, & akhtar, 2019). this project has not only short term goals of economic growth but also considers long term growth plans for pakistan. the initial investment of 46 billion us dollars was used to establish gwadar-port, modernize infrastructure, developing the industrial sector and pipelines of oil and gas as well as tackling energy crises in pakistan (babar & zeeshan, 2018; irshad, 2015; javaid & rashid, 2016; khan & ahmed, 2007; khursheed et al., 2019; xiguang & lizhou, 2015). this may lead to reduce unemployment and improve the overall economy of pakistan (joshi, 2018; tong, 2014; zia & waqar, 2018). irshad (2015) and khursheed et al. (2019) in their research concluded that china pakistan economic corridor (cpec) will ensure strong political as well as strategic relationships between china and pakistan. moreover, the project will help to improve pakistan’s economy by resolving the war-related problems in their border ranges (hassan, 2018; hussain, 2017; saad, xinping, & ijaz, 2019) and societal goals of the region including the provision of education and environment protection. it can be seen as the infrastructure development under the agreement of china pakistan economic corridor (cpec) may include schools, colleges, universities as well as institutional transport system which may significantly influence the level of education of local citizens of pakistan (blanchard, 2018b; cheng & chen, 2015; mattson, 2011; saad et al., 2019). south asian review of business and administrative studies vol. 4, no. 1, jun 2022 77 china pakistan economic corridor (cpec) has a direct or indirect linkage with the welfare of the common people of both countries. it will positively influence their economic and social well-being by encouraging industrial growth as well as competitiveness (bhattacharjee, 2015; blanchard, 2018b). under the mega project of china pakistan economic corridor (cpec), people living in slum areas will get the opportunity to establish their own business which was impossible for them in past due to the lack of financial resources. (blanchard, 2018a). cpec will encourage their entrepreneurial intentions (nazneen, xu, & din, 2019; sher, mazhar, abbas, iqbal, & li, 2019). moreover, tourist’s attraction towards cpec will improve the income level of the common people of pakistan. hence, it is concluded that cpec will create income-generating activities for local citizens of both countries (asomani-boateng et al., 2015; durani & khan, 2018; nasir, shah, & ahmed, 2016). based on the discussions given above, the following hypothesis has been developed; h1 income generating activities are positively associated with the effectiveness of cpec the primary objective of cpec is to deliver enormous benefits to the local residents of pakistan and china. residents' attitudes are favourably correlated with their perceived income (haq & farooq, 2016; haralambopoulos & pizam, 1996). haralambopoulos and pizam (1996) determined the positive correlation between a citizen's income and an optimistic outlook. in addition, scholars and cpec officials reported that the economic stability of the pakistani local community will increase as a result of the development of cpec projects (melecky, roberts, & sharma, 2019) because cpec offers numerous opportunities for the local community to start their own businesses. for instance, the local community can establish small industries, hotels, workshops, and agricultural product suppliers along cpec routes (tehsin, khan, & sargana, 2017), which may have a direct impact on resident income. studies from the past have also demonstrated that infrastructure development projects have a substantial effect on the host community, as they increase income, boost the economy, and eradicate poverty. infrastructure development under cpec will lead to the establishment of industrial sectors and many other economic zones which in turn, will create employment opportunities (ismail & mahyideen, 2015). during the period of the initial construction process of cpec, 38000 jobs were created out of them almost 75% were offered to local citizens of pakistan. it is expected that this mega project will create a large number of jobs for pakistan as well as its neighboring countries (today, 2014). cpec project will attract tourists from all over the world and this will increase employment opportunities in the region (sher et al., 2019). based on the discussions given above, the following hypothesis has been developed; h2 employment opportunities are positively associated with the effectiveness of cpec. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 78 figure 01: theoretical model of research literature suggests that as people's interests and means of subsistence change, the success of any endeavour including their participation is typically affected. the cpec is regarded as a win-win strategy not just for nations, but also for regions, because to its economic and strategic potential. according to experts, the cpec project benefited both chinese and pakistani residents (khwaja, saeed, & urooj, 2018; nasir et al., 2016; younis et al., 2020). the benefits of this investment would be exclusively appropriated by pakistani industries as well as households who would no longer face load-shedding. at the same time, pakistan would record 2 percent annual growth in gross domestic product (gdp). millions of work opportunities, quality education, economic prospects, and easy access to major cities would raise the level of living of both pakistan's and china's local populations (khan & ahmed, 2007). small villages along the cpec route will be linked to large cities, where local farmers would be able to sell their goods at reasonable prices and quickly increase their household income. in addition, when locals profit economically, educationally, monetarily, and professionally from the development of the cpec project, they will support it more. this will ultimately lead to a reduction in poverty in pakistan. cpec is a megaproject that will involve neighbouring nations in regional industry and commerce. in turn, this will assist to reduce poverty and raise the living conditions of the average pakistani (ali, mi, shah, shah, & bibi, 2017; roy, 2019). based on the discussions given above, the following hypothesis has been developed; h3 poverty reduction is positively associated with the effectiveness of cpec. methodology to empirically investigate the effectiveness of china pakistan economic corridor (cpec), convenience and snowball sampling techniques were used to collect the data. the target population of this study was less educated citizens of, pakistan. the data were collected via a structured questionnaire which was written in english as it is an international language and considers a second language in pakistan. because the respondents were less educated people, the questionnaire was translated into urdu for the understanding of those who found difficulty in understanding the questions. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 79 a total of 384 questionnaires were distributed to less-educated citizens of pakistan including teachers of primary schools, labor, security guards, clerks of higher secondary schools, selfemployed citizens who were having their small businesses like grocery, shoe-market, etc. because the target population was less educated, they got helped by the authors where they found difficulty in understanding questions. all of the respondents were above the age of 18. out of 384 questionnaires, 169 questionnaires were found with usable responses which represent the 44.01 percent response rate. however, 18 questionnaires were not filled properly and they were having incomplete information. due to this reason, they were excluded. only the questionnaires having complete information were used for further process. the demographics of the sample of our study are shown in table 1. table # 01: demographic information of the sample of a study table # 01: demographic information of the sample of a study sr.no variables sample (n) sample (%) 1. gender males females total 76 93 169 45.0 55.0 100.0 2. age 18-25 26-33 34-50 51-60 61 and above total 111 28 20 7 3 169 65.7 16.6 11.8 4.1 1.8 100.0 3. employment status employed self-employed un-employed total 31 45 93 169 18.0 27.0 55.0 100.0 4. income level 0-15,000 16,000-30,000 31,000-40,000 41,000-50,000 51,000 and above total 94 30 19 13 13 169 55.6 17.8 11.2 7.7 7.7 100.0 this study consists of four different variables out of the three are independent i: e income generation, poverty reduction, and employment opportunities, and one dependent variable i: e effectiveness of china pakistan economic corridor (cpec). for data collection, we have adopted the instrument and scale from previous researches. the questions 1-4 were for variable i:e income generation and were adopted from ali, mi, shah, shah, et al. (2017); ali et al. (2018) and kanwal, chong, and pitafi (2019). questions 5-8 were for variable i:e poverty reduction and were adopted from kanwal, pitafi, et al. (2019); saad et al. (2019), and kanwal et al. (2020)... questions 9-15 were for variable i:e employment opportunities and were adapted from (saad et al., 2019). questions 14-16 were for dependent variable i: e effectiveness of china pakistan economic corridor (cpec) and were adopted from (kanwal, chong, et al., 2019). all the items have been measured on a five-point likert scale which indicates strongly agree 1 to strongly disagree 5. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 80 data analysis and results the authors applied many different techniques to confirm the validity and reliability of the instrument used for data collection. the validity and reliability of the used instrument were confirmed using statistical package for social sciences (spss). the reliability and validity have proven with the result as cronbach’s alpha was greater than the desired valued i: e .06 suggested by (fornell & larcker, 1981) and (sekaran, 2003). factor analysis was performed to check the loadings of items and percentage variance explained. the factor loading of each item was found greater than the desired range i: e 0.60 suggested by (merenda, 1997) and (hinkin, 1998). table # 02: results of factor analysis sr.no construct items loading ca %ve factor # 1 income generation % variance explained 4 .823 .860 .818 .790 .839 67.760 factor # 2 poverty reduction % variance explained 4 .833 .823 .833 .782 .835 66.930 factor # 3 employment opportunities % variance explained 5 .842 .745 .834 .834 .742 .858 64.124 factor # 4 effectiveness of cpec % variance explained 3 .845 .857 .724 .733 65.744 where ca = cronbach’s alpha and % ve = percentage variance explained. as per the information given above in table # 02, we have the values of cronbach’s alpha and percentage variance explained above the acceptable range. in the case of the first factor i:e income generation we have cronbach’s alpha and percentage variance explained .839 and 67.760 respectively. similarly, in factors 2, 3, and 4 we have acceptable values of cronbach’s alpha and percentage variance explained. the acceptable range of cronbach’s alpha is ≥ .70 while in the case of percentage variance explained this value should be ≥ 50% (merenda, 1997) and (sekaran, 2003). table # 3: kaiser-meyer-olkin (kmo) test sr.no construct kmo significance 1 income generation .785 .000 2 poverty reduction .774 .000 3 employment opportunities .834 .000 5 effectiveness of cpec .650 .000 in kaiser-meyer-olkin (kmo), we measure statistical data and have a minimum acceptable level i.e. 0.50 (hair, sarstedt, ringle, & mena, 2012). all the constructs of our study have kmo greater than the minimum acceptable level. in our 3rd factor i.e. employment opportunities we have a higher kmo than the minimum level. table # 4: mean, standard deviation and correlations of data south asian review of business and administrative studies vol. 4, no. 1, jun 2022 81 where µ and σ are means and standard deviations respectively. *correlation is significant at 0.05 level (2 tailed), ** correlation is significant at 0.01 level (2 tailed). the mean values have been accessed based on average factor scores. table # 5: regression results sr.no construct β sig r2 a-r2 sig a 1 2 3 constant income generation poverty reduction employment opportunities -.099 .416 .407 .000 .219 .000 .000 .512 .5039 .000 dependent variable: effectiveness of cpec. the regression analysis was performed to investigate the effectiveness of china pakistan economic corridor (cpec) in creating employment opportunities, reducing poverty, and generating income. the result is shown in the table presents the overall significance of the model as the significant values are less than 0.05 which is acceptable for the significance of the regression model (sekaran, 2003). variables µ σ 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 income generation poverty reduction employment opportunities cpec effectiveness gender age employment status income level 2.3905 2.3491 2.3669 2.3215 na na na na .73385 .73710 .72265 .68031 na na na na .689 .710 .447 .031 .257 .087 -.082 .817 .681 -.004 .201 .200 .016 .677 .114 .240 .107 .009 .078 .125 .207 -.030 na -.351 .080 -.290 na -.109 .180 na -.137 na south asian review of business and administrative studies vol. 4, no. 1, jun 2022 82 figure # 2: results of regression discussions the authors conducted this study to examine the effectiveness of the china pakistan economic corridor (cpec) in generating income, reducing poverty, and creating employment opportunities for less-educated citizens of pakistan. here, the effectiveness of china pakistan economic corridor (cpec) depends upon whether it has worked to generate income for less-educated citizens, reduce poverty by creating employment opportunities for them. ahmed et al. (2017) recommended in their study that research on the effectiveness of cpec could be conducted by targeting the less educated citizens. the authors collected data from the less educated communities of pakistan and in this way, this research realizes how the lecc educated community of pakistan perceives the effectiveness of this mega project. this study is a useful contribution to literature as this is the first study that considered the less educated public of pakistan to investigate the effectiveness of cpec. although previous studies i.e. (saad et al., 2019) and (ali et al., 2018), however, none of them used the less educated community of pakistan for data collection. hence, this study reveals significant contributions to the literature and has significant implications for policymakers. our findings confirm that employment opportunities and poverty reduction are positively associated with the effectiveness of china pakistan economic corridor (cpec). hence, proved the first and second hypothesizes of our study. on the other hand, income-generating activities are found to be negatively associated with the effectiveness of china pakistan economic corridor (cpec). hence, it rejected the third hypothesis of our study. finally, pakistani people see the cpec as an excellent opportunity for raising their living standards. undoubtedly, china pakistan economic corridor (cpec) can significantly help pakistan to build and maintain good relationship with its neighbor countries of the region i.e. bangladesh, india, iran, afghanistan, and the middle east. moreover, this mega project is considered critical for industrial growth and trade promotion. overall, the results of this study confirm (saad et al., 2019) and (ali et al., 2018) as they concluded that this mega project is a very useful tool for economic growth and development. this project can positively influence the economy of both countries i.e. china and pakistan by improving the living standards of people and quality of life, poverty reduction, and employment opportunities. they found cpec as an important indicator of boosting up the economy of both nations. this study is an important contribution in the literature of cpec as this will leave a path for the government of pakistan as well as policymakers work on building training centers for lesssouth asian review of business and administrative studies vol. 4, no. 1, jun 2022 83 educated citizens to avail of the chances of jobs offered by the china pakistan economic corridor (cpec). conclusion our study investigated the effectiveness of china pakistan economic corridor (cpec) in terms of generating income, reducing poverty, and providing employment opportunities to less-educated citizens of pakistan. the findings of the study have confirmed two of our hypothesis and proved that cpec as a megaproject helps reduce poverty and create employment opportunities for lesseducated citizens. our findings are a useful contribution to the literature as they provide a view of less educated people of pakistan about cpec effectiveness. most importantly, our findings offer suggestions to the government as well as policymakers to establish training institutions to make less educated people skilled labor. this would increase the chances of getting jobs and in turn, may lead to a reduction of poverty in pakistan. finally, our study would strongly recommend the government of pakistan to establish training institutions for less educated people which will enable them to get the benefits of a china pakistan economic corridor (cpec), a megaproject. china’s investment through cpec would benefit pakistan in developing infrastructure and overcome energy shortfall. this, in turn, will improve the living standards of the people of pakistan. in short, to be successful, this project requires a distinct approach i.e. specific goals and targets, clear delineation of responsibilities, a well-defined set of indicators having both the incentives as well as penalties for performance/non-performance and transparent accountability. implications this study uncovers many significant implications for the government and policymakers of pakistan. for example; our study reveals how less educated communities of pakistan particularly of underdeveloped areas see the effectiveness of cpec for themselves. most of the people respond in favor of the development of cpec. however, they do not perceive this project as helpful for creating income-generating opportunities. in this scenario, the policymakers and government should work to improve the cpec project in a way that it may help to create income-generating activities for less developed areas of pakistan. in general, pakistan lacks policies regarding tourism. by promoting tourism and trade activities, cpec can significantly create incomegenerating activities. our government and policymakers need to emphasize this project and make improvements to enhance the opportunities of employment and reduction in poverty as well as the creation of income-generating activities for less-educated communities of pakistan. the government should provide incentives and special job quotas for less educated people of the underdeveloped area to improve their lifestyles and to get rid of poverty. the government should also build new educational and training institutes in rural areas to make it possible for less educated and poor people to get educated and trained for new employment opportunities. references ahmed, a., arshad, m. a., mahmood, a., & akhtar, s. journal of chinese economic and foreign trade studies. ahmed, a., arshad, m. a., mahmood, a., & akhtar, s. 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(2018). employment generation and labour composition in cpec and related road infrastructure projects. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 86 microsoft word sabas, v4 i2 p2.docx south asian review of business and administrative studies vol. 4, no. 2, dec 2022 103 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas analyzing the impact of oil prices on commodity future listed on pakistan mercantile exchange (pmex) in the era of covid-19 muhammad saeed iqbal, university utara malaysia (uum) mohd fikhri bin sofi, university utara malaysia (uum) article details abstract history revised format: nov 2022 available online: dec 2022 keywords agricultural commodity; wheat and soybean: covid-19, oil prices and pakistan mercantile exchange the main objective of this paper is to find the relationship between pmex oil prices and agricultural commodities (wheat and soybean), using data on a daily basis from 2019 to 2021 in the era of the covid-19 pandemic. with the unit root test, regression is checked with the help of the augmented dickey fuller’s (adf) test. it is utilized to determine the long-term relationship between the variables of the study. moreover, the connection among the selected variables is tested by the regression of the result commodity. in the results, we found that the selected variable of oil prices has become the first difference stationary and the selected variables (wheat and soybean) have become the second difference stationary based on the pmex. the ols results revealed a significant and positive relationship between agrarian commodities (wheat and soybean) and oil prices during the covid-19 era. it reveals the long term relationship between oil prices and the agricultural commodity prices of wheat and soybeans on the pakistan mercantile exchange (pmex). © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: iqbaliub4@gmail.com doi: https://doi.org/10.52461/sabas.v4i2.1513 introduction the impact of oil prices on agricultural products is high due to the coronavirus pandemic, but several important efforts are being made to find the fundamental relationship among these variables. these studies observe the influence of the pakistan mercantile exchange index and fuel prices on agricultural commodities during the coronavirus pandemic. this research analyses the effects of bio fuel prices on agricultural commodities based on the pakistan mercantile exchange. research showed an upsurge in crude oil prices during the coronavirus pandemic on pakistan's mercantile exchange (pmex). in the era of the covid-19 pandemic, fuel oil prices result in enhanced effects on agricultural commodities. (zhang et al., 2015; esmaeili and shokoohi, 2016; and avalos, 2016). agricultural commodities like wheat and soybeans and fuel oil prices are continuous and significant variables. these crude oil prices and agricultural commodities are especially important for developing countries like pakistan. developing states like pakistan suffer from economic fallout from the influence of covid-19 and experience an increase in fuel oil prices as they are a huge importer of crude oil. oil is the mainstay of their economy, which is connected through other arenas like companies, agrarian commodities, south asian review of business and administrative studies vol. 4, no. 2, dec 2022 104 and transport. these studies observe the influence of the pakistan mercantile exchange index and fuel oil prices on agricultural commodities in the era of the covid-19 pandemic. due to covid19, there may be a uni-directional fundamental association between fuel prices and product futures. it has been discovered that an increase in fuel prices caused by the coronavirus disease results in higher rates of advanced experimental merchandise used in the production of crude oil. (zhang et al, 2020: esmaeili and shokoohi. 2016: and avalos. 2016). the rise in crude oil prices and agricultural products in the international market during the covid-19 pandemic has been pretentious by traders and has induced business misplacement. that’s why this upsurge in oil prices has affected the agrarian product's economic value also. there is also a link between pakistani fuel prices and international oil prices, as well as us biofuel. (kiani, 2011). in the coronaviruses, the oil prices of all enlisted parties were alike, but during the coronaviruses of 2020, the prices of pakistan's crude oil surged, and it was further analyses that as this pandemic continued, the fuel prices in pakistan market would continue to increase compared to the international crude oil market. this continuous increase in fuel oil prices in pakistan during coronaviruses impacts directly the price of agricultural commodities. during the coronavirus situation, the association between crude oil and commodity futures prices has been analyses by a sum of scholars. (vu, vo & macaleer, 2019), (toeh, chein, fong, yue & tan, 2014) & (macaleer, 2019). a uni-directional link exists between fuel prices and agrarian products like wheat and soybean prices. (kapusuzoglu & ulusoy, 2015). in the era of covid-19, fuel prices are incessantly increasing, which results in an increase in the prices of agrarian products due to the usage of crude oil products in the field of agriculture for various purposes. moreover, the increase in price would also negatively impact the wheat and soybean markets. (harri, nalley & hudson, 2009). agricultural products like wheat and soybeans are defined as physical commodities that can be bought or traded, and can be traded by agricultural commodities at good value. natural resources like fuel oil and agricultural products like soybeans and wheat are common types of commodities. an international firm can purchase the oil at a lower price and sell it at a higher price. (alley, 2020). this study covers the link between agricultural commodities like wheat and soybeans and oil prices during the era of coronavirus spread. fuel prices are one of the most significant and critical issues. during the coronavirus issues, which also greatly affect the budget. (alley, 2020). in the era of covid-19, fuel prices have jumped, especially for importing nations. as a result, if fuel prices are in conflict, the oil trade procedure may fail. (maria. 2020). then there is insufficient study in the era of the covid-19 pandemic which displays the effect of fuel prices on the pakistan mercantile exchange. a sum of research must be completed to discover the link between crude oil and agricultural commodity prices. (nazlioglu & soytas, 2012), (kristoufek & janda, 2019). during this time period, along with various consequences of this pandemic on the economy, this link between two variables is also studied. (guellil, belmokaqddem & benbouziane). the purpose of the study is to examine the influence of basic oil prices and agricultural products in the context of the coronavirus in pakistan. the current study is an effort to drive support and provide more useful ground on the perspective of how crude fuel prices precede agricultural products in the context of pmex during coronaviruses. the former studies do not consume and measure these limits and qualifications during the coronaviruses, i.e., do high crude oil prices influence agricultural products in the era of covid-19? south asian review of business and administrative studies vol. 4, no. 2, dec 2022 105 literature review crude oil crude oil is defined as a physical quantity that returns energy. when crude oil is acceptable to respond through other matter, the power is barred as warmth or energy. the basic framework of crude oil consists of carbon and hydrogen having an incendiary nature. the crude oil of altered types is wood oil, coal oil, fuel oil, diesel oil, natural gas, and gasoline. coal and natural gas are the main types of crude oil. crude oil is the most abundant type of coal on earth. by way of refinement, petroleum can be the main type of oil that will be used for energy in the coming years. it is still used in rising nations to get energy. a sum of work is present on fuel prices, agricultural products, and conversation rate properties (liu,yang &liu, 2019), (zafeiriou, arabatzis, karanikola, tampakis, & tsiantikoudis, 2018). commodity the term "commodities" refers to a varied group of assets that include large markets such as cattle, metals (industrial base), precious metals, cereals, energy, and cash crops. these markets are together referred to as "commodities." the distinction between the valuation of commodities and that of bonds and stocks lies in the fact that commodities are seen as representing actual physical assets, whilst bonds and stocks are regarded as representing financial assets. their value is determined by an economic projection of future pricing, which is in turn determined by the demand and supply for the physical product in question. in the trade of commodities, there are three different types of trading parties that are involved: speculators, arbitrageurs, and informed hedgers and investors. i speculators ii. arbitrageurs iii. pricing for commodities may be broken down into two categories: futures prices, which are based on future delivery, and spot prices, which are based on current market conditions. the current price at which a commodity may be brought or acquired in a particular place is referred to as the "spot price," and it is defined as such. an exchange-based price that is agreed on in order to bring or purchase a certain quality and quantity of a physical commodity at a future date is what is referred to as a futures price. both monetary and physical delivery of the goods are acceptable methods for fulfilling the terms of the commodity contracts. (howes, 2020). wheat one of pakistan's most important agricultural exports is wheat. pakistan is the third biggest producer of wheat among the nations in asia, and it also exports a significant quantity of the grain. wheat is grown by the people of pakistan over a total area of around 9 million hectares of land, making up approximately 40 percent of the country's total covered area. pakistan's overall output is close to 6.6 million tonnes, and out of that number, the country exports 4.3 million tonnes (results from the international grains council, igc). these results may be ascribed to the efficient use of irrigation water, the high quality and quantity of the inputs, favourable weather conditions, and the early planting of the seeds. it is the province of punjab that is responsible for the cultivation of a significant amount of wheat. (ismail & jabeen). soybean soybean plants are used to obtain cooking oil and other valuable goods. sufficient sunlight and running are the conditions for the development of plants. pakistan spent nearly $900 million per year on imports. pakistan can reduce its imports, improve the attractiveness of its age, and reduce the chances of contamination if it establishes its own plantation. at that stage, its manufacturing in the international sector is around 33 billion tons. pakistan, india, malaysia, and india are the main producers of this agrarian product. the use of soybean fuel is in cooking and nutrient goods. it is also used in cleansers, cleaners, oil, makeup, oil, and a variety of other products. it is likely that in the upcoming years in the shires of baluchistan and sindh, almost 900 lands of terrestrial south asian review of business and administrative studies vol. 4, no. 2, dec 2022 106 determination will be used for the manufacture of soybean plants. it was determined through research that soybean fuel is the most practical and cost-effective source of vigour and nutrition in the global marketplace (ayub, 2018). covid-19 pandemic this study elaborates on the effects of the coronavirus on the crude oil prices and agricultural products futures listed on the pakistan mercantile exchange, pmex. we have taken the daily closing of the price statistics of world bank data and daily final oil prices, agrarian products like wheat and soybean prices during the coronavirus pandemic futures listed on the pakistan mercantile exchange (pmex). we have determined only agricultural commodities like wheat and soybeans and crude oil prices and their relationship with the other variables. furthermore, the measurement of production in these agricultural commodities, wheat and soybeans, is much higher than in other variables. independently, after that, to make a relationship study between agrarian commodities and crude oil prices which are affected due to the coronavirus infection, we have taken daily basis data from the pakistan mercantile exchange (pmex). further, changed republics are not elaborated on in the object owing to the absence of data obtainable and the influence of the covid-19 pandemic is not linked to other countries like pakistan. (farhan ahmad, 2020). de medeiros, r.k., et al. (2019) due to the impact of the covid-19 pandemic, alternative methodologies were advised to forecast the asymmetrical oil prices and agricultural products like wheat and soybeans. they used crude oil market financial reports and varied rates of return to make the sentimentality meter. to measure the financial method aimed at their forecasting accuracy, they make use of the mean square error method. it showed the low impact of crude oil prices in the era of the covid-19 pandemic achieved by accepting sentimentality as a key, the midas model, and high incidence signs. muramalla et al. (2020). studies the long-run relationship between crude oil costs and agricultural products like wheat and soybeans in indonesia in the era of the covid-19 pandemic. in practice, the granger connection and ardl were used to explain the long-term relationship between agricultural product prices, crude oil prices, and financial markets. short and long-term relationships were there among crude oil prices and asian products like wheat and soybeans during the covid-19 pandemic. in fact, due to the covid-19 pandemic, a unidirectional relationship was established between crude oil prices and agricultural supplies, and an 11 percent unidirectional relationship was established between gdp and inflation. cepni, o, et al. (2020). i investigated the crude oil price tremors based on the subtitles of entire produce turn for eighteen markets with dissimilar crude oil markets. construction issues were investigated in a different way than crude oil prices, which were dependent on the source of crude oil. in the coronavirus pandemic in crude oil prices, an increasing burden was used. crude oil importing economies increased in all phases, while crude oil exporting firms decreased. more crude oil importing countries have an increasing influence on demand and supply determined shocks, and the influence of protective shocks is also determined in crude oil importing countries. these studies were found to be valuable for global traders for collection, strategies manufacturers, and hedging judgments. liu et al. (2019). investigate the profit and volatility after the crude oil marketplace for products, future markets and energy spots by using different empirical methods. it was determined by the useful methods that natural gas has the main impact in the era of the covid-19 pandemic on the crude oil market. by way of the historical distance of transfer for agricultural commodities like soybeans and wheat, an upsurge in profit spillover is experiential. during the coronaviruses pandemic to agrarian products prices, their impact was disintegrated to some crude oil prices, it south asian review of business and administrative studies vol. 4, no. 2, dec 2022 107 was studied that profit spillovers existed in a short time, though instability spillovers remained shaped in the long run. instability spillovers are known to be complex for risky economic proceedings. majuca et al. (2020). in the era of the covid-19 pandemic, the effect of crude oil costs upon genuine gdp, financial profit spat taxes, agrarian products, and the rise in malaysia was felt. they employed the muti-variet ardl and the course error alteration method. as a result of the 2% drop in crude oil prices in the united states, gdp was reduced by approximately myr 747 billion. similarly, a 0.05 percentage point drop in agrarian products was investigated for a nearly 2% drop in crude oil prices. the submission of the adf method suggests the existence of loss instability determination between crude oil, exchange and agrarian merchandise (wheat and soybean) during the coronavirus pandemic. zavadska et al. (2020). determined based on the share of product futures and spot crude oil prices. the objective was to examine the main lag association specifically in the era of the covid-19 pandemic. annual data was composed from the era of 2019 to 2020 and standards were occupied by annual final prices. consequences revealed that there was a long-term and short-term relationship between crude oil prices and agrarian commodity prices. instability examinations performed display that issues activate production to an energetic share in instability inspection. such research is beneficial to the financials, who rely heavily on crude oil supplies for their vigor. shu-mei chiang et al. (2019). to complete this determination, ardl's strength and component methods were working. the study also delivers helpful information about bio-fuel agricultural commodities in relation to crude oil prices and the usa money table. the results of the research demonstrated that the ardl method does not offer product fit of monthly data in relation to instability subtleties for different agricultural commodities during the coronavirus pandemic. this method is too helpful for the available models of predicting. crude oil prices and agrarian products influence each other in a positive way to achieve the profit of agrarian products. for a wellorganized understanding of crude oil prices and agricultural products futures price differences, the ardl trend method was found to be helpful during the coronavirus pandemic, being of period variable hurdles, fleeting module, and enduring factor (chiang, chen, & huang, 2019). mcealeer et al, (2020). planned the association between crude oil prices and agrarian products like wheat and soybeans. the investigation was finalized by using short samples in the era of the covid-19 pandemic from 2019 m2 to 2021 m6. the findings from wang et al. and the further research were simulated. agricultural commodities like wheat and soybean trading charges prices big change much due to the covid-19 pandemic influence in the case of crude oil prices, which was defined by the observed results. moreover, for the agricultural commodity prices of totally sub-sample, the crude oil supply shocks were not significant. after the sum of agrarian products similar to wheat and soybean improved, the effect of total request tremors on the upcoming interchange marketplace existed but was not as robust as it remained in wang et al. only two agricultural commodities were measured, and only two agricultural commodities were influenced by the era of the coronavirus pandemic, the major era, and only two agrarian products, similar to wheat and soybean, were affected by the additional era. unlike in the second and fourth periods of the coronavirus pandemic, agricultural commodities such as wheat and soybean have a significant impact on crude oil demand shocks. in the era of the coronavirus pandemic, these old-fashioned agricultural commodities are hugely varied by the crude oil marketplace, as was obvious by the practical results. later, the collective mandate tremors the influence of agrarian products exchange on crude oil values was also deliberate. to achieve this education desire, the purpose was to show that tremors did not exert south asian review of business and administrative studies vol. 4, no. 2, dec 2022 108 any prominent influence on the covid-19 pandemic on crude oil prices through the second era. during the coronaviruses, the effect of the positive, significant relationship between basic oil values and agrarian products. during the covid-19 pandemic, the crude oil prices of half of agricultural commodities such as wheat and soybean were discovered to have a significant impact on crude oil prices. earlier, the implementation performance of the crude oil price policy act was such that practical results could not be found. agricultural commodities that influence crude oil prices, such as wheat and soybeans, are not chosen at random, as such agricultural commodities are used in crude oil efforts. the scope of crude oil values consumed has remained unchanged, so the chances that agricultural commodities like wheat and soybean can improve the crude oil market have also increased a lot. the current research work provides various ideas for governing policies. by the end of the literature review, the theoretical framework and hypothesis will be h1: there is a positive and significant relationship between oil prices and wheat commodity futures in the context of covid-19. h2: there is a positive and significant relationship between oil prices and soybean commodity futures in the context of covid-19. research frameworks before we observed the empirical evidence, it was important to identify a positive significant to identify a theoretical relationship between oil prices and commodities (wheat and soybean) during coronaviruses. the terms of trade channel mostly focus on oil prices and commodities, while the coronaviruses have an effect on oil prices and commodities. figure 1. iv & dv research methodology data this study adopts a quantitative data approach and an empirical test to the analysis of the data for 2 year periods (from 2019 to 2021). our analysis of the effect of crude oil prices on agricultural commodities like wheat and soybeans is based on the daily closing prices of wheat, soybeans and crude oil futures. the sample time frame covers the era of the covid-19 pandemic. the pnex data was most recently updated on december 31, 2019. the analyses that follow are based on the pmex data. the data was gathered from the world bank and pmex. methodologies in the era of coronaviruses, these studies examine the impacts of the world bank data and oil prices on wheat and soybean product futures. the reason why this daily study of the positive and significant relationship among these variables. first, the appearance of significant updates (e.g., irregular exchange, boom prices, etc.) in a marketplace will directly cause rare fluctuations in commodity standards and the result of coronaviruses of price jumps, as indicated by the (mcaleer, m. (2019). as a result, the price of agricultural commodities is coronaviruses exaggerated by south asian review of business and administrative studies vol. 4, no. 2, dec 2022 109 soybean, wheat, and crude oil production, as well as fluctuations in world bank data to the pmex. the adf model is used to (mcaleer, m. (2019). when the augmented dickey-fuller test of unit roots test is used as a post-estimation test for long-run causality analysis for acceptance or nonacceptance of developed hypotheses, probability values (p-values) are to be compared with the level of significance. this study set a 5% level of significance throughout the statistical analysis. the decision rule is that for a hypothesis to be accepted, reported p-values should be less than 0.000. in other words, p-values should be statistically significant. a statistically important examination result (p< 0.05) mean that the test should be rejected. a p-value greater than 0.05 mean that no effect was observed. unit root test stationarity or no unit roots mean that data has a time-invariant mean and variance. there is a first theory to be achieved that the variables have unit roots at the level of d2 oil prices, but when these variables are converted to the second difference (2), they become stationarity. there is a second theory to be achieved that the variables have unit roots at the level of d1 wheat, but when these variables are changed to the first difference (1), they become stationarity. there is a third theory to be achieved that the variables have unit roots at the level of d1 soyebean, but when these variables are changed to the first difference (1), they become stationarity. the augmented dickeyfuller (adf) test has been used for checking stationarity between variables. data analysis and adf results interpretation the chapter presents the findings from the gathered data, performs analysis of the data, and covers the results of this data collection from pakistan mercantile exchange and world bank data during the covid-19 pandemic. this section organized the data in a logical manner. the main data source for this research was collected data from secondary data. data analysis was performed using statistical tests. the findings obtained for all variables using adf division and approach are provided in the table. the regression results for wheat in the context of covid-19 are shown in the table, and for soyebean in the context of covid-19. stationary test table 1. augmented dickey-fuller test (adf) test (adf) test results. d: difference in variables prob d2: oil prices in the context of covid-19 0.026 d:1 wheat in the context of covid-19 0.001 d:1 soyebean in the context of covid-19 0.045 test outcomes for the augmented dickey-fuller test (adf) are shown in the table. oil prices in the context of covid-19 (d2.) are stationary after the second difference, d 2.1. wheat in the context of covid-19 (d 2.1) has become stationary after the first difference, and soybeans in the context of covid-19 (d 2.2) has become stationary after the first difference. statistical test; z (t) is used to measure variables such as oil prices and commodity futures, indicating a difference when variance is introduced. h0: oil prices in the context of covid-19 are not stationary. h1: oil prices in the context of covid-19 are stationary. the probability value of the variable of oil costs in the situation of covid-19 is 0.0026, while the level of significance of the study is set at 5%. as the probability value is less than the 5% level of significance, so we rejected our null hypothesis and accepted the alternative hypothesis and concluded that oil prices in the context of the covid-19 variable are stationary at the second difference. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 110 h0: wheat prices in the context of covid-19 are not stationary. h1: wheat prices in the context of covid-19 are stationary. the probability value of the variable of wheat costs in the situation of covid-19 is 0.001, while the level of significance of the study is set at 5%. as the probability value is less than the 5% level of significance, so we rejected our null hypothesis and accepted the alternative hypothesis and concluded that wheat prices in the context of the covid-19 variable are stationary at first difference. h0: soybean prices in the context of covid-19 are not stationary. h1: soyebean prices in the context of covid-19 are stationary. the probability value of the variable of soyebean costs in the situation of covid-19 is 0.045, while the level of significance of the study is set at 5%. as the probability value is less than the 5% level of significance, so we rejected our null hypothesis and accepted the alternative hypothesis and concluded that soybean prices in the context of the covid-19 variable are stationary at the first difference. regression results of wheat in context of covid-19 in the regression results of wheat in the table, wheat in the context of the covid-19 variable had a coefficient of 3.86, wheat t-state; 3.89 with a constant coefficient; 0.55, constant t-stat; 23.15 and probability of zero was observed. here the results have 491 observations showing the values of rsq.; 0.1192, f-stat; 16.64, prob > f; 0.000, correspondingly. as per the result of ols, there exists a significant and positive association between wheat prices and oil prices in the context of covid19. table 2. regression results of wheat in the covid-19 variables coefficient t-stat probability oil price in the context of covid-19 3.86 3.89 0.000 constant 0.55 23.15 0.000 note: r-sq.; 0.921, f-stat; 16.64, prob > f; 0.000, no. of observations; 550 as the coefficient value of the variable oil price is 3.86, which shows that 1 percent (r-sq) is 0.921, which shows the explained variation in the analysis of prices of wheat due to the change in oil prices. it tells us that the regression model explains 92.1 percent of the change in wheat prices as a result of changes in oil prices. during covid-19, an increase in the price of oil will raise the price of wheat by 3.86 percent. the value of the test statistics is 3.89, with a probability value of 0.000. it shows that the variable of oil price is significant at 5 percent level of significance. in the above table, the coefficient of shows the f-stat is 16.64 with a probability value of 0.000, which shows that the overall model is significant at a 5 percent level of significance. regression results of soybean in context of covid-19 table 3. regression results of soyebean in the context of covid-19 variables coefficient t-stat probability oil price in the context of covid-19 9.84 13.57 0.000 constant 1.25 41.15 0.000 note: r-sq; 0.72, f-stat; 23.15 prob > f; 0.000, no. of observations; 550 as per the result of ols, there exists a significant and positive association between soybean and oil prices in the context of covid-19. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 111 as the coefficient value of the variable of soyebean is 9.84, which show that a 1 percent increase in the oil price will increase the prices of the soyebean due to covid-19 by 9.84 percent. the value of test statistics is with probability value of 0.000. it shows that the variable of oil price is significant at 5 percent level of significance. in the above table, the coefficient of determination (r-sq.) is 0.72, which shows the explained variation in the analysis of prices of soybeans due to the change in oil prices. it tells us that the regression model is explaining the 72 percent change in the prices of wheat as a result of change in oil prices. the f-stat is 23.15 with a probability value of 0.000, which shows that the overall model is significant at a 5 percent level of significance. discussion & conclusion this study employs the adf model and discovers a positive relationship between crude oil prices and commodities (wheat and soybean) during the coronaviruses. the result shows that the us dollar index and biofuel prices do affect the values of wheat and soybean commodities. the adf method provides a positive link between oil prices and wheat and soybean prices. on a daily basis, data for fuel prices and agrarian products like soybeans and wheat are taken from the certified sites of the pakistan mercantile exchange (pmex) and the world data bank. the time sequence figures out 550 observations, of these variables operating in stocks and advertising marketplaces in pakistan from december 2019 to june 2021. in the wheat and soybean commodity markets, the research concludes that oil prices significantly affect the wheat and soybean futures prices and, in the short-run, crude oil prices can forecast the wheat and soybean commodity markets during the covid-19. to sum up, we conclude that oil prices have a positive correlation in the long run with agrarian commodities. research concluded that crude oil prices have a pronounced effect on wheat and soybean futures prices, but the wheat and soybean spot prices are also influencing the oil prices owing to the covid-19 epidemic. during the covid-19, the futures markets for wheat and soybean were found to be more sensitively influenced by increased oil prices than the spot markets for wheat and soybean in pakistan. trading of wheat and soybean commodities in the futures market of the pakistan mercantile exchange is advised on the basis of achieved results. the study suggests the most desirable trading strategies in terms of oil price sensitivity for marketing wheat and soybeans in pakistan. futures recommendation & limitation this paper has some failings due to the covid-19 pandemic as well as how it opens ways for future research too. this study suggests future research on independent variables such as oil price in the context of the covid-19 pandemic, as well as dependent variables such as wheat and soybeans in the context of the covid-19 pandemic. this study is limited to the collection of data of daily basis oil prices, wheat and soybeans from pmex and world bank data from 2019 to 2021. for better results, further researchers may enhance the data for more than 02 years or on the basis of daily basis data. finally, this study is limited only to the oil values in the situation of covid-19, wheat and soybeans over the period of 2019 to 2021, or 02 years based on pmex. references alley, l., & hudson, d. 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(2014). examining the impact of the world crude oil price on south asian review of business and administrative studies vol. 5, no. 1, june 2023 75 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas effect of teaching practices on students’ persuasive writing skills in subject of english at secondary level dr. qudsia fatima, university of education lahore, pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords teaching practices, english writing skills teaching english writing skill is challenging target for teachers at all levels of education in pakistan. there are variety of teaching practices used by teachers for improving writing ability of their students. this study was based on teaching practices used at secondary school certificate and ordinary level in english by using causal comparative design. sample of the study comprised of all the schools of lahore city offered ssc and o level simultaneously by using purposive sampling technique. test and rubrics were administered to students at the same time to know their level of learning. questionnaire was developed to determine the teaching practices used by teachers. to determine the interrater reliability of scoring krippendorff alpha was calculated. findings of the study showed that achievement of students differ significantly of students of both groups (ssc and o level). teachers of ssc were in favour of using teacher centered practices, on the other hand, o level teachers frequently used student centered. it is suggested that teachers of ssc should use student centered teaching practices and rubrics should be given to students along with test for assessment of essay type questions for reliable scoring. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: qudsia.fatima@ue.edu.pk doi: 10.52461/sabas.v5i1.1928 introduction due to growing demand in international market, english writing is important objective of curriculum of ssc and o level. stage of secondary level is important due to preparation of students in job market and to enter higher education institution, therefore, much attention is needed at this level. students of secondary level face lot of difficulties in writing from initial grades because of education system around the country which focus on achievement scores of students as the only criteria to measure success without judging the explanatory power to answer questions. there is apparently no difference in english writing learning outcomes of ssc and o level. learning outcomes are well planned, structured and detailed in the curriculum of both streams that addresses the students’ ability to write effectively. english language learners face difficulties due to ineffective practices of teaching used by teachers. there are practices sound more effective than others and teachers use them according to the needs and grade level of students. while teaching students and teachers use both student centered and teacher centered approaches. research shows that student centered approaches are more useful causing significant difference in students’ https://journals.iub.edu.pk/index.php/sabas mailto:qudsia.fatima@ue.edu.pk south asian review of business and administrative studies vol. 5, no. 1, june 2023 76 achievement as compared to teacher centered approaches. brainstorming and feedback (hyland, 2007), and extensive reading (harmer, 2007) were used for development of writing skills. various studies have been conducted to examine the impact of the styles of teaching on the examination system at ssc and o level in subject of english (mirza, nosheen & nasir, 1999; khan, 2011, 2012; behlol & anwar, 2011). chughtai (1990) also highlighted how english language learners face difficulties in english at secondary level. examining the difference in learning outcomes and teaching practices at two streams of secondary education (ssc and o level) running parallel in private schools was still unexplored in pakistan. it is generally assumed in pakistani context that there is discrimination among students qualified from ssc and o level. to unfold whether difference exists, same test addressing similar learning outcomes was developed and administered to students of both streams. private schools have high resources for children than government schools. this study attempts to minimize the effect of students’ socio-economic background on their achievement by selecting schools offering both streams concurrently, therefore, the sample included only private schools offering ssc and o level simultaneously having similar learning environment. research study done by sunday, deborah, andokari, and ereson (2014) done in nigeria found that english language teachers at secondary level give emphasis on rote learning of content without following process of writing. content is given to student by teacher to memorize it. the only emphasis is given to achieve high scores in examination. difficulties faced by students in english writing are not identified by teachers therefore, they lie in students’ writing products. constantinou, chambers, zanini, and klir (2019) elaborated that content alignment with appropriate use of english is essential feature of students’ writing. without appropriate use of linguistic devices student is unable to produce adequate piece of writing. an effective text is free from linguistics errors and identify students’ ability to write effectively. ahmed (2010) explored that english language writers at secondary level take english at tedious activity. the reason is that teachers do not teach students the process of writing and never engage them in this process, therefore, it becomes a passive activity where no interest is created in classroom. for these classrooms the key to achieve good marks in cramming and students realize that better they cram lead to higher scores. students face problems in writing english and finding it difficult to prepare assignments on a specific topic given by teacher. limited proficiency creates hindrance for them to work accurately for this assignments or other tasks assigned by teachers. he recommended that classroom assignments may be completed under supervision of teachers so that students can get timely feedback to improve their writing proficiency. teaching practices have significant role in developing students’ english writing skills. there are certain practices found effective at specific group of students. effect of practices varies from student to student according to capabilities, interests, grade and age level. teachers of secondary level use variety of teaching practices to achieve intended learning outcomes. although both ssc and o level have almost same intended learning outcomes but there is clear difference in the use of teaching practices. some practices sound more effective than others. teachers of o level use student centered approaches that tend to achieve learning outcomes. they involve their student in process of writing to make the product effective. whereas, teachers of ssc prefer teacher centered approaches with little involvement of students in the writing process. south asian review of business and administrative studies vol. 5, no. 1, june 2023 77 first step for developing any piece of writing is brainstorming. brainstorming is concerned with listing all the points related to topic on paper. hyland (2004) and brandon (2001) elaborated that developing and connecting ideas to each other develop help writer to produce coherent piece of writing. during brainstorming teacher may give clues according to the need and help students to produce effective writing. writing skills help students practice paraphrasing, sequence opportunities for synthesis, and thus enhance their ability to develop writing skills. the technology helps students express themselves more confidently without worrying about handwriting and spelling mistakes. with the integration of technology in the classroom, the approach of teaching the reading and writing skills has changed meaningfully. the main advantage of technology is that when writing on a computer or other device, grammatical and spelling errors will be alerted immediately so that learners can make corrections immediately. it will enable learners to receive instant feedback from their teachers. however, in an abundance of technology, the students of english language can become best readers and writers of english. (ismail, al-awidi & almekhlafi, 2012). through the use of relevant strategies, students are given explanations or grammatical rules. they make phrases and sentences based on these explanations or rules. as in the teachers’ explanation, students are able to memorize spellings and students will be asked to use the correct grammar to make a complete sentence (setiawan & wardani 2023). the technique of scaffolding can also be utilized in a diverse way. as a result, students will complete their writing assignments collaboratively and also have opportunities for pair or group work. windsor and park (2013) found that using this scaffolding method for generating the language is useful to complete the writing task. group work is another strategy where students are given opportunities to discuss and collaborate with each other. in this way students get opportunity to share their ideas that results in increasing their knowledge. if group work is efficiently done by teacher addressing the planning, sequencing and editing then its productivity can be enhanced. bibi (2002) discussed that when students are engaged in group work they become more active and get more opportunities for language learning. they work more for long without getting bored. khabbazbashi, khalifa, robinson, ellis, and mifsud (2017) expressed that role of teacher becomes more important during group work. teachers can attain intended learning outcomes through group work. feedback is another strategy used in classroom to teach writing. khan (2013) discussed that with the help of feedback students come to know their problems and difficulties in english. teacher can give oral and written feedback as both types facilitate students to improve their writing. oral feedback is done by teacher in classroom verbally while written feedback is provided on students’ piece of writing where errors in writing are pointed out by teachers. extensive reading strategy help the students to read extensively to broaden their vision. if students are given opportunities to read extensively it will help them to get ideas, organization of ideas, vocabulary, sentence format and mechanics. teacher can provide material in the form of essays, newspapers, articles, magazines, stories, novels and other material related to it. research done by ahmed, and rajab (2015) and mosha (2014) shows that extensive reading develops students’ writing with little involvement of teacher. the writing material given to students will help to improve all domains of writing. lecture is traditional method of teaching that is considered important to teach a large as well as small groups of students. this method is extensively used to explain, elaborate and clarify the content. bolaji (2014) found that lecture method is not useful at low grade level. teacher can’t south asian review of business and administrative studies vol. 5, no. 1, june 2023 78 maintain interest in classroom with the use of this strategy. however, this method is useful with large group of students to save time. the use of right questions for students during teaching is effective strategy to develop writing proficiency. chandio, khan, and samiullah (2013) discussed that to teach writing quality questions should be asked instead of just floating question without any purpose. another strategy used by teachers in classroom is to teach writing is provision of clues to get ideas about specific topic. clues help students to get ideas where they need any help about topic. provision of model text to students help them to improve all the three domains of writing. text is provided to students in the form of stories, novel, magazines, essays and work done by a student in the same class to motivate others. widiningrum (2013) discussed that model text help students to improve their writing fast. this method can be used with learners who have low proficiency in english writing. peer review is related to the work reviewed by class fellows or peer group who give comments used in classroom. elftorp (2007) found that this strategy helps teachers to save time and building students’ confidence. it also makes active involvement of students to become efficient learners. purpose of the study increasing demand of english as a second language in pakistan, has been a great task for teachers to develop language proficiency among students. the reason is that it is international language, therefore considered the status symbol, and importantly in examination almost all subjects require english to enable students to get the marks and achieve success in examination. it means due to good proficiency in english, student may obtain high scores in other subjects as well. this study was conducted because there is apparently no difference in framework of english writing learning outcomes according to the curricula of ssc and o level systems in terms of intended learning outcomes. general aims of english writing curriculum of both streams are almost same that particularly focus on students to communicate effectively in english and will clearly seek out differences on persuasive writing skills. research questions this study intended to answer the following research questions: 1. which teaching practices are used to teach ‘developing ideas’ to the students of ssc and o level? 2. which teaching practices are used to teach ‘sequencing ideas’ at ssc and o level? 3. what is the difference in the use of teaching practices to teach mechanics of language? 4. which differences exist for the overall mean scores of students on persuasive writing? 5. what is the difference of mean scores of students’ achievement for developing ideas on persuasive mode at ssc and o level? 6. what difference exists between students’ mean scores on sequencing ideas at ssc and o level? 7. which differences exist between mean scores of students on language conventions? methodology this causal comparative design was chosen for the study as the groups were already formed due to non-manipulation of independent variable. sample comprised of students and teachers of private schools of lahore city that offer ssc and o level concurrently. english writing test based on persuasive writing handed over to students and questionnaire was given to teachers to determine teaching practices. south asian review of business and administrative studies vol. 5, no. 1, june 2023 79 test for students english writing test (appendix a) was administered to students of both streams to know their achievement in english. essay type test based on persuasive writing was developed addressing intended outcomes mentioned in curricula of both streams. under persuasive writing three domains of writing such a developing ideas, sequencing ideas and mechanics of language were assessed (as discussed in curriculum of ssc and o level). scoring rubric (appendix b) was given to raters and students to avoid complexities in scoring. each marking script was marked by three scorers. training of scorers was done for one week through an expert from the field of educational assessment. scorers marked students’ script on three domains included in the scoring rubric (e.g. developing ideas, sequencing ideas, and mechanics of language) for writing task. weigle (1999) examined that trained raters can identify differences in students’ writing than untrained raters and thus increase the reliability of scoring rubrics. krippendorff’s alpha was calculated to determine the interrater reliability of scores after initial administration of the test for pilot study to assess the extent of agreement among multiple raters artstein & poesio (2008); & krippendorff (2011). it is a statistical measure and its value range is from ‘0’ to ‘1’ with ‘1’ for perfect reliability and ‘0’ indicates that there is no reliability (gwet, 2010). reliability of question was α = .7696 development of questionnaires for teachers questionnaires developed from 5 (always) to 1 (never) was administered to teachers in brief and simple language. validity of the questionnaires relevant experts in the field of english language testing, teaching practices and evaluation were determined for consultation. experienced english teachers of secondary level were given questionnaire for clarity, relevance of the items, time taken to complete it and other relevant feedback (cohen, 2007). improvement was made by incorporating the suggestions. after completing the validation process, questions were improved before finalization of questionnaire. reliability of questionnaire questionnaire was given to 24 teachers to identify the use of teaching practices in english writing classes. cronbach alpha for measuring internal consistency was used to determine the reliability of questionnaire. α= .84 findings following findings were drawn from analysis of test. teaching practices for development of ideas: teachers’ responses research question 1: which teaching practices are used to teach ‘developing ideas’ to the students of ssc and o level? table 1 compares the use of twelve teaching practices for developing ideas as per teachers. south asian review of business and administrative studies vol. 5, no. 1, june 2023 80 table 1: teaching practices for ‘development of ideas’ teaching practices ssc(12) mean rank o level (12) mean rank z p brainstorming 9.38 15.62 -2.427 .016 group work 9.00 16.12 -2.584 .010 clues 10.57 14.41 -1.454 .146 assignments 11.27 13.83 -.969 .333 presenting in front of class 9.00 16.00 -2.584 .010 lecturing 14.63 10.38 -1.609 .108 q/a method 11.71 13.20 -.665 .506 extensive reading 13.50 11.50 -1.445 .039 gives model text to produce similar 13.38 11.63 -.627 .531 role play 11.55 13.47 -.705 .481 written feedback 13.55 11.47 -.744 .459 oral feedback 13.09 11.93 -.507 .614 mannwhitney statistic was calculated to determine whether there was any statistical significant difference between teaching practices for developing ideas. statistically significant difference was found between four teaching practices of ssc and o level. there is more use of brainstorming questions asked by the teachers, group work, extensive reading in the form of newspapers or magazines and presentation by students in front of the class at o level than ssc. teachers of o level give more emphasis to these practices and consider it important for development of ideas as compared to ssc. however, in case of remaining practices, no significant difference was found. teaching practices for sequencing ideas: teachers’ responses table 2 compares the use of teaching practices at ssc and o level related to sequencing ideas. the use of these nine practices depends upon its usage given by teachers of both streams. research question 2: which teaching practices are used to teach ‘sequencing ideas’ at ssc and o level? table 2: comparison of teaching practices for ‘organization of ideas’ teaching practices ssc(12) mean rank o level (12) mean rank z p group work 11.71 13.29 -.613 .535 jumbled words/sentences 16.29 8.71 -2.765 .006 assignments 11.24 13.74 -.841 .361 south asian review of business and administrative studies vol. 5, no. 1, june 2023 81 presentation 11.25 13.75 -.900 .368 lecture 13.14 11.97 -.382 .685 questioning 12.13 12.88 -.273 .785 read extensively 10.96 14.04 -1.111 .281 feedback (written) 15.75 9.25 -2.363 .018 feedback (oral) 12.58 12.42 -.061 .951 mann whitney statistics was calculated to determine if difference exists between teaching practices at two streams. table shows that there is significant difference was found for the use of particularly two practices such as jumbled words and to organize sentences and feedback given on students’ notebooks as well as verbal comments. these practices are highly used at ssc classrooms to improve writing. no difference exists for the use of other practices used in classrooms. teaching practices for language conventions: teachers’ responses following table presents the use of teaching practices at ssc and o level for developing language conventions. research question 3: what is the difference in the use of teaching practices to teach mechanics of language? table 3: teaching practices for ‘language conventions’ teaching practices ssc(12) mean rank o level (12) mean rank z p editing 11.92 13.08 -.420 .675 group work 12.29 12.71 -.156 .876 written feedback 13.04 11.96 -.407 .684 oral feedback 11.38 13.63 -.828 .408 sentence completion 16.46 8.54 -2.897 .004 drill 16.88 8.13 -3.123 .002 matching exercises 15.46 9.54 -2.106 .035 peer review 12.79 12.21 -.215 .829 self-review 13.46 11.54 -.728 .467 grammar 13.50 11.50 -1.445 .149 assignments for practice writing 13.50 11.50 -.749 .454 presentation 8.79 16.21 -2.644 .008 lecture 12.50 12.50 .000 1.000 question answer 12.00 13.00 -1.263 .206 extensive reading 10.58 14.42 -1.385 .166 list of words for vocabulary learning 13.54 11.46 -.743 .458 practicing punctuation 13.50 11.50 -1.048 .294 memorization of spelling 16.29 8.71 -2.695 .007 table 3 presents data for developing language conventions to improve writing. mean rank values indicated that there is more use of five practices at ssc such as sentence completion exercises, matching exercises given in book, drill for memorization of vocabulary. they also use presentation south asian review of business and administrative studies vol. 5, no. 1, june 2023 82 and dictation for spelling to teach writing. teachers of ssc consider these practices important for improving writing skills related to language conventions. on the other hand, presentation of the students in front of the class is the only strategy having significant difference is compared to ssc highly used at o level. students’ writing skills on persuasive writing. task of students’ writing skills regarding persuasive contained 30 marks . t-test was determined to find out overall mean scores. research question 4: which differences exist for the overall mean scores of students on persuasive writing? table 4 mean difference on students’ persuasive writing skills at ssc and o level α=0.05 table 4 illustrates that t322 was significant beyond α .05. mean difference shows that skills of students at o level was found advanced (20.12) over students of ssc (17.15). this was in favor of o level students in terms of their achievement. it shows that students of o level possess high ability to attain english writing skill. persuasive writing learning outcomes (by domain) table 5 shows the level of english writing skills of students on persuasive writing domains (10 marks were specified for each domain). research question 5: what is the difference of mean scores of students’ achievement for developing ideas on persuasive mode at ssc and o level? research question 6: what difference exists between students’ mean scores on sequencing ideas at ssc and o level? research question 7: which differences exist between mean scores of students on language conventions? table 5 mean scores difference in domains of persuasive writing dimensions of writing ssc (n= 167) o level (n=157) t x̄ sd x̄ sd t (322) sig. developing ideas 5.68 1.68 6.65 1.12 5.48 <.001 sequencing ideas 5.65 1.63 6.77 1.08 7.27 <.001 language conventions 5.68 1.98 6.68 1.32 5.16 <.001 α=0.05 ssc(n=157) o level(n=150) t df sig. x̄ sd x̄ sd 17.15 4.92 20.12 3.51 6.27 322 <.001 south asian review of business and administrative studies vol. 5, no. 1, june 2023 83 table 5 demonstrates that t value (5.48) with df (322) was found significant showing difference on development of ideas at ssc and o level. it demonstrated that students of o level have a better tendency to develop ideas as compared to students of ssc. for sequencing ideas, it was evident that a significant t value (7.27) with df (322) showing that the mean score of writing in this domain was higher at o level. it exhibits that the students of o level have better ability of sequencing than students of ssc. t-test on mean scores for language conventions with t value (5.16), df (322) showed significant difference. it showed that better writing skill was found for students of o level to produce writing as compared to students of ssc. hence, o level have better ability to present effective piece of writing in all the three domains. student’s script with band 2: scorer’s comment (appendix a) writing was generally addressing the question with loosely connected content. there were few reasons for issues and arguments with less elaboration. events moved quickly without sufficient development. although reasons were provided, yet they were not much convincing of persuading the argument. slight organizational pattern was visible throughout the essay without logical progression with lacked cohesion. although persuasive text included in beginning and at the end but there were weaknesses in logical connectivity. in addition, student does not know how to develop consistency and logic among them. paragraphs comprised of a single sentence with grammatical mistakes. there were errors in basic sentence structure and the use of punctuation marks that impede the flow. word choice and vocabulary were also limited. there were spelling mistakes in commonly used words, however, communication was not hindered to understand the purpose (e.g. tellicommunucation (telecommunication), famly (family), ralitavies (relatives). overall errors in mechanics and its usage occurred occasionally in student’s writing. comments on students’ script having band 4 (appendix b) the writer discussed the usefulness of mobile phone with relevant information to support the opinion (e.g. sources of communication, internet, use of social apps, games, pictures and songs). various arguments and opinions were also used for having mobile phone to make learning favorable (modern source of learning, use of dictionary, scientific calculators, time saving). comprehensiveness with convincing ideas was presented. ideas were coherent where student demonstrated a clear proper start and end. the writer developed relationship among various ideas that provides reasons for the use of mobile phones. sentences were connected logically within the paragraph to provide a sense of how to proceed ideas. a variety of sentence structure could be seen, which gave a sense of clarity in word choice. in addition, the paper clearly followed the conventions of mechanics, usage, and spellings. although the writer was not able to present some of the ideas appropriately due to missing transitional links but the text reflected a mastery of writing. all aspects of the task were sufficient showing a logical progression throughout the writing. on the whole, the writing seemed complete with minor weaknesses in the writing. discussion this study was conducted to determine the influence of practices of teaching in english writing skills of students of ssc and o level. there were certain practices used by teachers to teach english writing at both streams. findings showed that teachers of o level found effective student centered approaches to involve their students whereas teachers of ssc prefer teacher centered approaches. teachers of both streams use variety of practices to develop ability to generate ideas. practices highly used at o level were brainstorming, presentation, group work, extensive reading whereas teachers of ssc prefer written feedback, matching exercises, sentence completion, drill and dictation for spelling. south asian review of business and administrative studies vol. 5, no. 1, june 2023 84 findings of the study indicated that brainstorming is frequently used strategy at o level for teaching writing. brainstorming is first process in the process of writing where writer lists all the arguments linked with the topic. by comparing other studies of the world, elftorp (2007) found that this strategy helps the students to jot down all the points related to topic to produce piece of writing as proved from the current study. group work was found effective at o level to engage learners in classroom where they collaborate with each other in the form of groups to discuss all the steps from planning to editing. evidence of the relevant research showed that this strategy helps learners to produce adequate piece of writing (kemboi, andiema and mbone; 2014). another findings of the study indicated that presentation is effective strategy to be used at o level in terms of attainment of learning outcomes. oral presentation is useful where students present their work in front of the whole class. this sharing is useful for students to listen to each other’s ideas. findings of tompkins (1990) and munch (2004) conformed this strategy to be followed at ssc to teach writing effectively. extensive reading is highly used at o level in writing classrooms. this strategy found helpful for students of english language to make their writing effective. students of o level showed good performance. this strategy found useful to teach various dimensions of writing through extensive reading. related research shows that extensive reading strategy found effective for developing english writing skills (walczak, 2017; ahmad and rajab, 2015). tolbert, lazarus, killu (2015) discussed that teachers bring newspapers, magazines, pictures and story books to give their students a broader exposure to teach writing in a broader context. finding of the research observed that lecture is extensively used by teachers of ssc to teach writing. relevant literature shows that lecture is traditional method of teaching to teach english writing. naeem (2011) found lecture is important strategy at secondary level but it leads to memorizing the content. it is considered for students of limited as well as higher proficiency. ahmed (2010) also found this strategy is useful for learners with limited proficiency. there is highly use of jumbled words for arranging complete sentences at ssc. literature shows that this strategy is useful for learners with low proficiency. it is basically used at lower levels to make complete sentences. test used in this study comprised of essay type question. writing skills of students were assessed on dimensions of writing named generating and sequencing ideas; and mechanics of language. achievement of o level students was comparatively better than students of ssc. this finding is in accordance with naeem (2011) and ahmed (2010). conclusion this study concludes that student centred approaches are being used at o level where active involvement of students is considered -necessary. on contrary, teachers of ssc prefer product oriented teaching where the focus of both teachers and students is on the finished piece of writing instead of involving students in the writing process. present study found that persuasive writing skills of o level students are better than ssc. mean scores of o level students were better in developing and sequencing ideas; and correct use of language conventions on persuasive mode as compared to ssc students. south asian review of business and administrative studies vol. 5, no. 1, june 2023 85 this research has been gone through meaningful conclusion that how teaching practices affect students’ writing skills having same environment of schools as well as similar intended learning outcomes. it can be recommended that if teachers of ssc use students centered approaches as preferred by teaches of o level such as brainstorming, group work, presentation and extensive reading, their english writing skills can be improved. for future research, academic motivation of teachers and students may be explored under the same school systems. in this research this element was not included due to lack of time. in curriculum of ssc instead of mentioning general practices some specific practices may be suggested to teach writing only. references ahmed, a.h. 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(2009). controlled writing as a class exercise for beginners. retrieved july 17,2013, from http://stibaeswe.wordpress.com/category/publikasi/page/2/ south asian review of business and administrative studies vol. 5, no. 1, june 2023 87 south asian review of business and administrative studies vol. 1, no2, dec 2019 67 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.2, dec 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas estimating the effects of fiscal policy on economic growth in pakistan: a time series analysis syed mumtaz ali kazmi, national college of business administration and economics, pakistan syed muhammad imran, national college of business administration and economics, pakistan hassan mujtaba nawaz saleem, universiti utara, malaysia article details abstract history revised format: nov 2019 available online: dec 2019 keywords fiscal policy, economic growth, time-series, adf, co-integration test, vecm, pakistan this paper is an effort to inspect the reverberations of fiscal policy on economic growth in short along with long run. to fulfill this purpose, annual time series data for the period 1980 to 2014 is employed. at first, augmented dickey-fuller (adf) unit root test is used to check stationarity of data. the results of adf test denote that growth rate of gross domestic product, total government revenues, total government expenditures, fiscal deficit, physical capital, and labor force participation rate are stationary at first difference, i(1). secondly, we deploy johansen-juselius co-integration test to examine long run association of fiscal policy and economic growth. the results of this test reveal long run association of fiscal policy and economic growth. finally, we treat variables by using vector error correction model (vecm) to examine short run dynamics as well as long run causal relationships. the results of this model indicate long run causal association of fiscal policy and economic expansion. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: kazmi.mumtaz@gmail.com doi: https://doi.org/10.52461/sabas.v1i2.435 introduction in an economy many variables are responsible for growth. according to many economists, the subject of growth is incomplete unless fiscal policy is included as a valuable factor in growth procedure. government interference in the working of an economy is due to the fact that market imperfections are not a rare phenomenon. prices and wages tend to be sticky and automatic forces fail to put the economy in economically better situation so, government’s actions can be justified easily. great depression of 1930s pushed the united states into an economic downfall where employment opportunities were at low level and people started to migrate to western countries in search of employment. keynes (1936) put stress on government’s intervention in the form of https://journals.iub.edu.pk/index.php/sabas mailto:kazmi.mumtaz@gmail.com https://doi.org/10.52461/sabas.v1i2.435 south asian review of business and administrative studies vol. 1, no2, dec 2019 68 fiscal policy for efficiently working of the economy. economic downfall held its roots once again in usa in 2008 and at that time fiscal policy accelerated the economic growth. so, in today’s global world its importance has much more emphasized. governments all over the world frame and apply public policies. a public policy, in simple words, also called fiscal policy. fiscal policy is an effective tool to influence economic growth. the topic of fiscal policy is infinite and have various aspects convoluted. there has been a clear accord of economists that taxation and spending structure of an economy is a strong fiscal tool of the government to accomplish many goals. the most important objective may be to realize economic growth as fiscal studies show its importance in an empirical manner. government’s magnitude in advanced economies is much larger than evolving economies, so in developing economies there is much fiscal space and government can remediate actions of producers and consumers. fiscal policy plays a key role in attaining higher growth. it is frequently concerned with tax revenues and government expenditures. fiscal policy aims can be allocation, redistribution, stabilization, and encouragement of economic progress, among which economic progress is most important as theory identified. two common standpoints are listed concerning to role of fiscal policy in enriching economic growth. the ordinary neoclassical growth framework represents that course of long-run economic growth is resolved by advancement in quantities of labor, capital (physical & human), and technological growth. if public policy is able to augment the enticement of private sector to save and further to invest, it will modify capital/output ratio. consequently, towering gdp growth rate will expedite per capita income, but it is possible only in the short run. in the long-term initial level of gdp growth will be restored. chamley (1986) was also presented the same view that fiscal policy effects growth only in short run and it has no long run impact on growth. many modern economists are agreed on the point that government policy can shape the economy. when government spends more, aggregate demand increases which brings about growth. to evaluate the impact of public policy on growth, endogenous growth patterns are used. these economists employed “endogenous growth prototype” with some improvements. agenor (2010) used endogenous framework to observe the impacts of public policy. an important feature of research in the field of fiscal policy is to examine partially the long and short run upshots of fiscal policy. this departure is indispensable as this is the major dissimilarity between neoclassical and endogenous styles. moreover, the objective of this work is to probe the implications of effects of fiscal policy on economic growth underlying the economic environment of pakistan. the study unveils either tools of fiscal policy have positive or negative implications on economic expansion or public policy has no influence on economic growth in addition to this, the significance of undertaken study is that it will have deeper impacts on national as well as individual level. as it will offer fiscal options if government will act upon them, these will not only contribute to growth but will also certainly effect lives of citizens and deliver them better choices to raise their level of living. literature review many studies discussed the fiscal policy stance and its linkage with growth considering different fiscal rules. findings are mixed depend upon the time period, data types, and techniques. some studies have used aggregate measures and some others used disaggregated measures of fiscal south asian review of business and administrative studies vol. 1, no2, dec 2019 69 policy. different categories of government spending are used and different types of taxes have employed. that’s why results also vary. sample size is the main factor in this regard. it is also noted that by using same estimation methods and variables, results differ because of change in time period. abdon et al. (2014) investigated link between fiscal policy and its probable effect on economic conditions of asia. economic scenario of the region revealed government’s intervention is at lower level and it should be more in order to make the region economically more influential. property taxes have a more crucial effect on economic growth as compared to direct taxes. this piece of work defines the effect of different fiscal policy variables in nigeria. the results approve that expenditures move faster as compared to revenues. evidence suggests that government expenditures positively interrelate with economic services and growth. in addition, it is also observed that better working of private sector is conditioned with the firmness of government sector as evinced by agu et al. (2015). ahmad and sheikh (2011) investigated that among other developing economies, pakistan’s tax share to gdp is very low. the paper covers the tax reforms being imposed in the last two decades. they assessed that in pakistan, tax structure is characterized by inelasticity, non-neutrality, complexity and inefficiency. later 1970s, with the help of policy makers and international financial organizations, many endeavors have been taken to recover tax structure. it was discovered that objectives of enhancing public receipts, upgraded tax scheme and providing tax awareness to public were not accomplished. the causes of ineffective modifications were at both political and administrative levels. ahmad et al. (2016) examined the interrelationship between aggregate tax proceeds and growth of economy in scenario of pakistan. they utilized time-series sample for the period 1974-2010. their analysis was based on both short and long periods. they discovered that total tax income collected by government exerted negative influence on economic progress for longer periods. they observed that upsurge in total revenues by 1% reduces economic expansion by 1.25%. ahmed (2011) searched the contribution of government policy in growth process of pakistan by employing annual data pertaining to 1982 till 2010. revenues and expenditures were also included in the analysis. revenues were sub-divided into two categories i.e. tax and non-tax. in addition, revenues of both federal and provincial government were calculated to get better understanding regarding the revenues’ effect. expenditures were classified into developmental and nondevelopmental expenses. empirical evidence disclosed that revenues from non-tax sources positively affected growth at both government levels. but revenues from taxes were significant only in case of federal government and negatively contributed to economic growth. expenditures on developmental projects enhanced growth while non-developmental outlays exerted no effect on growth. ali and ahmad (2010) carried out a study to examine whether growth level is disturbed by fiscal policy. the economy of choice was pakistan. up to a certain level, fiscal deficit is positively related with economic growth but above that level there is persistence of negative relationship. the results are consistent with the theory as positive relationship exists for temporary period. the bond turns to be negative for the longer period. during the years 2000 to 2012, growth rates have been not so good in prospect of nigeria. in industries like agriculture and services, there was indication of growth, but overall economic condition of economy was disappointed. the factor behind was that fiscal policy measures were not satisfactory in nature and policy was not fully executed as propounded by asaju et al. (2014). south asian review of business and administrative studies vol. 1, no2, dec 2019 70 attinasi and klemm (2016) concluded that positive effects of fiscal consolidation were more as compared to its negative effects. baffes and shah (1998) scrutinized that military expenditures showed negative connection to output growth as depicted by one half of the economies included in the sample. barrell et al. (2013) employed nigem to indicate the magnitude of spending and taxation multipliers in perspective of diverse economies facing dissimilar circumstances. this approach was used to estimate the impacts of a one percentage point decrease in budget deficit by concentrating on eighteen developed countries. the value of fiscal multipliers is comparatively smaller in more integrated economies. spending multipliers acquires larger value than others. multipliers depend on government actions as the values of fiscal multipliers are larger if government actions are temporary, otherwise not. bernardi (2013) concluded that shifting of tax burden during last decade was not pervasive and enormous as believed. the tax shift put conflicted effects on economy in the short run and possibility was that it may intensify the economic collapse due to the acceptance of deterring fiscal policies in the european countries. bhattarai (2012) clinched in his paper that through fiscal policy, economic growth and income distribution both can be obtained simultaneously. government policies related to taxation can boost economic growth as well as reduce income inequality. brons et al. (2000) asserted that connections among fiscal policy, private investments and output growth are complicated and diverse. buti and gaspar (2015) explained that economic situations of the today’s world demand for a fiscal policy to face challenges linked with global growth. they recommended that renovation of fiscal policy is required to solve issues associated with today’s economies and especially in euro area. the best way to overcome country specific problems regarding development is to restructure automatic stabilizers of fiscal policy although not so easy as tax and expenses policies integrated with the economy may contrast with bestowed benefits. djelloul et al. (2014) focused on interrelationship between public policy and economic advancement. the panel analysis confirms association between fiscal policy and economic growth in the long run. causal relationship also exists between budgetary revenues and economic growth. moreno-dodson (2012) concluded that counter-cyclical fiscal policy is a good choice to avoid fiscal shocks during economic fluctuations. engen and skinner (1992) inferred that government spending and distortionary taxation have robust effects on output growth but in negative way. cross-country regressions were used based on data of 107 economies. it was also noticed that factors like tax system in terms of administration and magnitude of tax base also count when effect of fiscal policy on economic growth is concerned. gemmel et al. (2011) reconnoitered the influence of fiscal policy on growth. they used distortionary and non-distortionary tax revenue and productive and unproductive government expenses as symbols of government policy. they investigated that the impact of fiscal variables rest on their type. economic advancement is negatively impacted by distortionary tax revenue and unproductive expenses whereas productive expenses will encourage economic advancement as long as non-distortionary revenue are utilized to sponsor them. kakar (2011) revealed that the relationship of fiscal policy variables is more emphasized in milieu of prolong period as compared to short duration because variables explaining fiscal policy have long run implications in case of pakistan. madni (2013) scrutinized the deliberate effect of various types of fiscal outlays on the economic events. these expenses are functionally divided into productive group and unproductive group. further division of productive class describes the positive or impartial footprints onto economic growth whereas unproductive class elaborates south asian review of business and administrative studies vol. 1, no2, dec 2019 71 negative or neutral impacts onto growth. the study duration was 1979 till 2012. findings recommend that productive spending has no influence when its consequences are probed on economic circumstances of pakistan. unproductive spending referred its negative contribution for growth. munir and sultan (2016) discovered the aftermath of tax revenues on growth with regards to pakistan. real gdp was employed as a representative variable for economic growth. the separate reactions of direct and indirect levies were checked. they exposed equally temporary and permanent effects of taxes. direct tax revenues were taken into account as a whole but indirect tax revenues were employed apart. the results endorsed that direct taxes and indirect taxes like custom duties, general sales tax (gst), and surcharges had positive reverberations with real gdp both in short and long span of time. nazir et al. (2013) also found negative interrelation between economic growth and government spending whereas taxes exert positive effects on economic growth. this study is specific to pakistan’s economic conditions and also stressed on long duration coalition between budget policy and production. nijkamp and poot (2004) in a deep inspection of many research studies, explained the upshots of fiscal policies on long-term economic growth. they scanned that 17% of research scholars debated that positive link allying public policy and economic expansion; 29% discussed that the said position was negative; and 54% argued that no relationship exists as findings were statistically insignificant. padda and akram (2009) noted that high ratios of implemented taxes have destroying effects on economic expansion in pakistan, but the significant impact is temporary and not permanent. the connection between fiscal drain and economic enlargement was inquired by rizvi et al. (2010). data range in-between 1979-2008 was exploited. fiscal depletion for developmental purposes increases growth either it is short or long run. it was also noted that fiscal payouts depend upon economic augmentation. (sdpi, 2013) explains that taxes are important for an economy’s growth. the features of a good tax scheme are simplicity, transparency, impartiality and ease to pay taxes. tax structure in pakistan has many flaws and might not be labelled as fair and just. the costs of tax collection are high. certain sectors enjoy tax immunities while others not. administration is inefficient and collected revenue are less than the needs of economy. revenue collected as a share of gdp is comparatively low than other evolving markets. as a result of tax alterations, there was an enlarged number of tax-filers and enhanced revenue were utilized to complete different projects. due to reforms, revenue increased to 17 percent of gdp during 2011-2012. it is suggested that better results can be obtained if deregulation of economy is adopted with these tax reforms. srithongrung and juarez (2015) investigated the impacts on economic growth occurred by tax dues and investment spending in different states of mexico. the time period was 19932011. taxes influence growth negatively either the relationship is temporary or long lasting. taylor et al. (2012) unveiled of presence of powerful positive association of primary fiscal divergence with economic growth in the usa.turrini (2008) accounted for reactions of fiscal policy to business cycles. the study focuses european countries and data lengths from 1980 to 2005 period. the variables employed were taxes and government expenses. fiscal policy behavior was checked both in good and bad economic circumstances. the culmination reveals that fiscal policy was expansionary during economic boom indicating pro-cyclical inclination of fiscal policy whilst no strong corroboration was found out to regarding cyclical partiality of government policy during south asian review of business and administrative studies vol. 1, no2, dec 2019 72 recession. further exploration discloses government expenditures were purely responsible for this occurrence. the research also evaluated the powerful and weak expenditure policies and derived that these expenditure regimes may resolve fiscal policy inclination during economic boom. velnampy and achchuthan (2013) subject to sri lankan economic conditions and timeseries analysis, also scrutinized that impacts of fiscal divergence on financial progression are neutral having insignificant results. theoretical framework in general, fiscal policy is divided into two main components: government revenues government expenditures these are called two hands of public policy. the one hand i.e. government revenues collect money from the public and the other government expenditures, spend it to maintain a balance between income and spending. a vast empirical literature focused on the association concerning fiscal rule and economic progress casing diverse fiscal measures. as fiscal measures are viewed, different fiscal proxies are taken into account as aggregate expenditures, aggregate tax revenue, different categories of government expenses and tax revenue, fiscal deficit, balance of payment deficit, primary fiscal balance etc. literature shows that economic growth depends on physical capital, labor force participation, total government revenue, total government expenditures and fiscal deficit. so, our work is based on how and to what extent these variables effect the economic growth of pakistan. so, the underlined work selected combination of variables as growth rate of gross domestic product (grgdp), physical capital (kp), labor force participation rate (lfp), total government revenues (totrv), total government expenditures (xpend), and fiscal deficit (fisdf). we use proxy variables as representatives of major variables. for physical capital, most common proxy is gross investment rates as this is verified through a study conducted by barro (1991). the proxy designated to labor is labor force participation rate. in literature, commonly used proxies for fiscal rule are fiscal revenue (different categories), fiscal expenditures (different classes) and deficit. we are hiring total government revenue, total expenditures and fiscal deficit as policy variables. south asian review of business and administrative studies vol. 1, no2, dec 2019 73 theoretical scheme source: created by author model originating framework we make use of the growth accounting framework and for this purpose standard cobbdouglas production function is utilized which is of the form given below: gt = ttkpt ˠlfpt𝛅 fispolt𝛔є𝐭 (1) transforming model (1) into log form, we get 𝐋𝐨𝐠𝐆𝐭 = 𝐋𝐨𝐠𝐓𝐭 + 𝚼𝐋𝐨𝐠𝐊𝐏𝐭 + 𝛅𝐋𝐨𝐠𝐋𝐅𝐏𝐭 + 𝛔𝐋𝐨𝐠𝐅𝐈𝐒𝐏𝐎𝐋𝐭 + 𝐋𝐨𝐠є𝐭 (2) where 𝐋𝐨𝐠𝐓𝐭 = 𝐚 𝐋𝐨𝐠є𝐭 = є𝐭 𝐋𝐨𝐠𝐆𝐭 = 𝐚 + 𝚼𝐋𝐨𝐠𝐊𝐏𝐭 + 𝛅𝐋𝐨𝐠𝐋𝐅𝐏𝐭 + 𝛔𝐋𝐨𝐠𝐅𝐈𝐒𝐏𝐎𝐋𝐭 + є𝐭 (3) as equation (3) shows that lfp kp fisdf grgdp totrv xpend south asian review of business and administrative studies vol. 1, no2, dec 2019 74 𝐆𝐑𝐆𝐃𝐏 = (𝐊𝐏, 𝐋𝐅𝐏, 𝐅𝐈𝐒𝐏𝐎𝐋) (4) as, 𝐅𝐈𝐒𝐏𝐎𝐋 = 𝐓𝐎𝐓𝐑𝐕, 𝐗𝐏𝐄𝐍𝐃, 𝐅𝐈𝐒𝐃𝐅 (5) so, we can write it as 𝐆𝐑𝐆𝐃𝐏 = (𝐊𝐏, 𝐋𝐅𝐏, 𝐓𝐎𝐓𝐑𝐕, 𝐗𝐏𝐄𝐍𝐃, 𝐅𝐈𝐒𝐃𝐅) (6) econometric model an econometric model shows the relationships among specific variables by employing economic theory, mathematical representation and statistical measures to forecast the model. we are employing linear model notifies one to one relationship. in linear terms, the equation (6) takes the form as below: 𝐆𝐑𝐆𝐃𝐏𝐭 = ω + ω𝟏𝐊𝐏𝐭 + ω𝟐𝐋𝐅𝐏𝐭 + ω𝟑𝐓𝐎𝐓𝐑𝐕𝐭 + ω𝟒𝐗𝐏𝐄𝐍𝐃𝐭 + ω𝟓𝐅𝐈𝐒𝐃𝐅𝐭 + 𝛆𝐭 (7) where: ω = intercept coefficient ω1 to ω5 = slope coefficients t = “1980……. 2014” ε = error term grgdp = growth rate of gross domestic product kp = physical capital lfp = labor force participation rate totrv = total government revenues xpend = total government expenditures fisdf = fiscal deficit data sources and methodology data sources are assumed as: wdi (database of wb) handbook of statistics on pakistan’s economy (publication of sbp) the data range consists of 1980 to 2014. it is the data type that is not common in use in fiscal studies. model estimation process is to be done in following three steps: first step adf unit root test will be used to make sure that given series are stationary to continue further analysis. in examining the time-series data properties, different tests are used to check the stationarity but the most important one is adf unit root test. augmented dickey-fuller (adf) test was presented by dickey and fuller (1979). it was first called df test as it was based on the assumption that autocorrelation does not prevail in the model. but in the presence of autocorrelation, the test was useless. so, its developers redesigned it to overcome the problem of autocorrelation and augmented the lagged values of dependent variable then it named adf test. south asian review of business and administrative studies vol. 1, no2, dec 2019 75 second step johansen co-integration test is applied to know the strength and nature of long run relationship between the variables of our model. johansen-juselius (1990) and johansen (1988) developed this test. the test also called unrestricted co-integration rank test used to designate the long run equilibrium relationship. this test actually investigates the long run relationship between cointegrated variables or the variables that are stationary at first order i(1). third step in this final step, vecm is used to find out the nature and degree of temporal causality between the variables. vector error correction model (vecm) provides insight to short and long-term connections of our concerned variables. in this model, “error” refers to the deviation of a time series from its long run equilibrium and “correction” mentions the speed followed by underlying series to return to its equilibrium in long run. the test is based on restricted var and was settled by sargan (1964). estimations and results the estimated coefficients for above mentioned techniques are given in tables1,2, and three respectively. estimated coefficients of adf test in table 1, results of adf test for unit root are displayed. these results express that all concerned variables are not stationary at level i(0) but are stationary at first difference i(1). it means variables are co-integrated and can be employed for further attestation. estimated coefficients of johansen-juselius co-integration test in table 2, the findings lead to the existence of long-term relationship among grgdp, kp, lfp, totrv, xpend, and fisdf. both test statistics i.e. max-eigen and trace statistics provide same results. estimated coefficients of vecm in table 3, it is evident that no short run relationship exists between independent and dependent variables. it was attested by applying wald statistic on obtained short run coefficients from vecm. contrary to this, presence of long run relationship among variables is proved as error correction term (ect) is significant. it can be stated as due to fiscal variables joint in action with fundamental factors of growth, gdp growth turned to its equilibrium point at the speed of 113%. table 1: adf test for grgdp, kp, lfp, totrv, xpend and fisdf variables level first difference constant trend and constant none constant trend and constant none grgdp -2.15 -2.51 -1.23 -7.27* -7.23* -7.36* (0.22) (0.31) (0.19) (0.00) (0.00) (0.00) kp -1.40 -2.58 -0.88 -5.06* -5.03* -5.07* (0.56) (0.29) (0.32) (0.00) (0.00) (0.00) lfp -1.74 -2.48 1.09 -7.67* -7.45* -7.61* (0.40) (0.33) (0.92) (0.00) (0.00) (0.00) south asian review of business and administrative studies vol. 1, no2, dec 2019 76 totrv -1.91 -3.26 -0.61 -5.71* -5.61* -7.83* (0.32) (0.08) (0.44) (0.00) (0.00) (0.00) xpend -0.67 -2.22 -0.93 -3.48* -3.92** -4.54* (0.84) (0.46) (0.30) (0.00) (0.02) (0.00) fisdf -2.54 -2.96 -0.99 -7.33* -3.89** -7.44* (0.11) (0.15) (0.28) (0.00) (0.02) (0.00) *shows significance at 1% level **shows significance at 5% level p-values are expressed in ( ) source: generated by author table 2: johansen-juselius co-integration rank test for grgdp, kp, lfp, totrv, xpend and fisdf null hypothesis [h0] alternative hypothesis [h1] trace statistic critical value max-eigen statistic critical value r= 0 r≥1 126.00* (0.00) 95.75 59.48* (0.00) 40.07 *shows 5% significance level p-values re expressed in () source: generated by author table 3: vecm for grgdp, kp, lfp, totrv, xpend, fisdf ect(-1) -1.13* (-2.71) r2 0.54 s.e. 1.82 short run error correction estimates d(kp(-1)) 1.09 (1.54) d(kp(-2)) 1.03 (1.68) d(lfp(-1)) -1.18 (-1.53) d(lfp(-2)) 0.67 (0.98) d(totrv(-1)) -1.29 (-1.57) d(totrv(-2)) -0.14 (-0.30) d(xpend(-1)) 0.95 (1.79) d(xpend(-2)) 0.39 (1.04) d(fisdf(-1)) 0.20 (0.69) south asian review of business and administrative studies vol. 1, no2, dec 2019 77 d(fisdf(-2)) 0.42 (1.84) *shows 5% significance level tstatistic in parenthesis () source: generated by author conclusion we can conclude that growth rate of gross domestic product (grgdp), physical capital (kp), labor force participation rate (lfp), total government revenues (totrv), total government expenditures (xpend), and fiscal deficit (fisdf) have no short-term association but are bound in a long-term relationship. as it is concluded that in long term physical capital (kp), labor force participation rate (lfp), total government revenues (totrv), total government expenditures (xpend), and fiscal deficit (fisdf) were the factors that influence growth rate of gross domestic product (grgdp). literature about fiscal policy draws importance of these variables in permanent growth process. growth process remains incomplete, if these variables are not taken into account. in particular, together these variables affect growth in a very powerful manner in perspective of long run. policy recommendations government should surge tax revenues to prosper the pakistan’s economy as verified by empirical findings. but it should also kept in mind that revenues should heighten by imposing direct taxes rather than indirect taxes as burden of direct taxes is already more on people. public expenditures should also raise in order to obtain economic expansion. in this regard, productive expenses should escalate but not at the cost of fundamental provisions of life. although the effect of fiscal deficit is positive but it is suggested that government should try to maintain it at a certain level so that it may not be able to impede growth due to increase in debt stock in the long-term. physical capital stock should also proliferate as concerning to our economy, ground realities also favor our findings. as pakistan is a developing economy so there is need to accumulate capital for endurable growth. labor force participation should also escalate to reach higher economic expansion. in pakistan, unemployment is not a rare situation. government should provide work to people so on one side, they will be employed and on the other economy will develop. references abdon, a., estrada, g. b., lee, m., & park, d. 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(2013). fiscal deficit and economic growth: a study on sri lankan economic perspective. deve south asian review of business and administrative studies vol. 1, no2, dec 2019 80 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 99 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.2, december 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas role of communicative competence in enhancing performance at workplaces farhan sarwar bajwa, virtual university of pakistan muhammad sarwar bajwa, the university of lahore, pakistan article details abstract history revised format: nov 2019 available online: dec 2019 keywords human resource development, learning paradigm, performance paradigm, workplace dynamics, sustainable competitive advantage. in the present age, on account of rapid spread of technology, globalization, necessity of developing intellectual capital has become very intense. the satisfaction of this requirement has become challenging because of fresh realities surrounding people’s needs and demands, expectations of stakeholders, and workplace dynamics. first, the researcher in this paper assessed the importance and challenge of developing effective human resource. secondly, the researcher compared and contrasted the two famous paradigms i.e., learning paradigm and performance paradigm to see to what extent these can help in developing effective human resource at higher education institutions. the insight gained from the examination of these paradigms led the researcher to suggest a number of strategies for processing and promoting learning for the purpose of strategically developing human resource that could be delivered to organizations so that they could realise their strategic objectives for enhancing their competitive advantages. the researcher in the end concluded that if these strategies were employed in the domain of human resource development, optimal performance might be insured. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: farhansbajwa@gmail.com doi: https://doi.org/10.52461/sabas.v1i2.451 introduction in the present age the need of developing effective human resource has gone very high on account of rapid growth of population, rapid spread of technology and global economy. the rich states of the world spend huge budgets on the development of human resource that could enable them to achieve sustainable competitive advantage over their rival states and organizations. emphasizing the importance of effective human resource wagner (2008) says that in the 21st century, as economic, social, and technological change is gathering pace, countries and societies, being the part of global economy and society, require to attain full employment and sustained economic growth so that they, having seized the opportunities that are emerging rapidly in a global world of economy, can meet the needs of their people. but where is the key? wagner identifies that it is now being recognized that human resource i.e., people’s quality of skills and capabilities obtained https://journals.iub.edu.pk/index.php/sabas mailto:farhansbajwa@gmail.com https://doi.org/10.52461/sabas.v1i2.451 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 100 through their investment in education and training is the key with which doors to economic and social development can be opened. skills and training cause increase in people’s productivity and incomes. further, they ensure everybody’s participation in economic and social race of society. wagner’s position is quite in line with the goal of the international labour organization (ilo) i.e., the global economy should provide opportunities for all people to obtain decent and rewarding work in the conditions of freedom, equity, security, and human dignity. reinforcing the position of wagner, roma (2003) stresses the effective development of human resource, “in today’s world, an individual, a department and a company must all exhibit proof that they produce a positive result (p.8).” in a concluding manner, (anonymous n.d.) mentions the importance of human resource very aptly and concisely, when says “organizations survive and succeed on basis of one of their most important resources i.e. people or human resource.” as it has been mentioned above, in the 21st century, economic, social and technological patterns are changing rapidly. elements like, global organizations, regulations, competition and efforts to hold the globe are changing the bases and demands of competition. thus in this era of crosscurrents, turbulence and high ambitions of sustainable competitive advantage, “a discussion of the management of human resources in the twenty first century assumes a new complexity owing to the fresh realities surrounding people’s needs and demands, organizational stakeholder’s expectations, workplace dynamics and other emerging issues, (duke & udono 2012 p.158).” it follows from the position of duke &udono that developing the human resource effectively, in this age of fast-track change, demands new attitudes and competencies that ensure encouraging and enhancing creativity and innovation in the organizations. held (2012) supports the idea that hrd is an effective instrument that ensures the contribution of intellectual capital of an organization to its competitive advantage. mojtahedzadeh & izadi (2013) though agree with held and hu, yet qualify this idea saying that an organization needs a long time to develop human capital in terms of knowledge, motivation, interpersonal relationship, skills, abilities, attitude that outperforms the competitors by giving sustained performance. as it has been seen in the above discussion, development of effective human resource is very important for fulfilling the requirements of the present day global world for enhancing productivity and employability on the one hand and sustainable competitive advantage of the organizations on the other. with the advent of knowledge-is-economy age, after industrial age, it has been recognized that human element in the development of organization plays a key role. further, importance of learning has also found recognition. according to swanson and halton (2009, cited in anonymous n.d.). learning is at the heart of human resource development (hrd) and continues to be a core part of all paradigms of hrd.” despite the importance of learning, the concept of learning is still misty and its status and dimensions are not clear. it specially looks so when a dichotomous approach to hrd is considered. for example, the british have pursued learning based development paradigm that was focused to enhanced training and development genres. opposite to it, americans went for a performance based development paradigm that aimed at making individuals efficient to enhance organizational performance outcomes (simmonds and pedersen, 2006, p.122 cited in anonymous n.d.). it means one paradigm i.e., learning paradigm gives importance to human beings and capability; the other, i.e., performance paradigm gives importance to material outcomes and efficiency. both these paradigms are in the field and it needs to be decided how the end of effective performance can be achieved. south asian review of business and administrative studies vol. 1, no. 2, dec 2019 101 theoretical framework in this paper following terms are very important. they are defined and elaborated for the convenience of the readers. definitions learning learning can be defined as an interaction with environment that can bring about a relatively permanent change in a person’s behaviour, cognition or affect. the change brought about by learning is effected either by acquiring something new or modifying something that already exists and this change must be durable. it is generally acknowledged that learning outcomes can be skill based or affective but it does not include behaviour changes that are caused by physical maturation or a temporary condition. it is further added that hrd focuses on intentional instead of incidental learning. in the recent times various learning theories have been advocated. these theories include humanism, social learning, constructivism, holistic learning, behaviourism and cognitivism. these theories supply ground to facilitate development and behavioural change. thus the nature of learning demands active involvement of the employees of an organization. anonymous (n.d.) observes that hrd practices lead to causing a long-term, work related learning capacity at the individual, group and organizational level. scholars began to recognize the importance of learning during the last quarter of the 20th century and termed learning an important developable and tradable commodity of an organization. the literature, in respect of learning, usually focuses on changes in cognitive maps or changes in behaviour. elaborating the concept of these changes, wang & huang (2013) say that “the cognitive approach operationalizes learning in terms of the cognitive patterns associated with processing information and interpreting events. the behavioral approach operationalizes learning in terms of a routine-based mechanism in repeating or changing behaviors to respond but cognitive elements are not involved in the process (pp.56-57).” performance usually the concept of performance is associated with the assigned tasks. and this term is defined in the perspective of task. thus performance is the result of an effort to complete some task with special reference to time, cost and quality. peters (2007) elaborates this term or concept in broader terms when he says “performance means the amount of overall achievement of an individual or an organization throughout a specific amount of time. when performance is considered in the perspective of an individual or employee, attitudes and behaviour of that employee are also taken into account.” peter means to say that the concept of performance is not restricted to specific results of an effort that is made for the realization of organizational objectives. the performance of an employee also includes his/her certain behaviour that appear in the effort. another related concept is performance development which in the view of hu (2007) “is a systematic process of improving employees’ performance, involvement, motivation, and commitment in order to enable organization to achieve its strategic objectives.” sustainable performance the dilemma with performance is that it is mostly inconsistent and unreliable phenomenon whereas individuals and organizations need a consistent and sustainable performance to keep their competitiveness intact. its consistency may be insured through certain measures. in this context peters (2007) maintains an appropriate rather useful approach. according to him there are four basic elements that are common to all human performance: (1) knowledge is the foremost necessity for being able to do things or being “proficient” in doing things. if, for example, an employee or manager has knowledge of the steps in good decision making process, he will give better performance in decision making. (2) skill is an individual’s level of proficiency in south asian review of business and administrative studies vol. 1, no. 2, dec 2019 102 performing tasks. simply having knowledge of doing things does not suffice for performing each task well. mostly, knowing how to do things does not translate into a good performer. here one needs some proficiency in completing steps of doing things. (3) for giving high performance, individuals need to be enabled to perform i.e., they should not suffer from environmental roadblocks or restrainers (hostile culture and negative attitudes). (4) for the achievement of high performance mark, employees must be willing to use their knowledge and skills and also be willing to overcome the environmental roadblocks which inhibit their performance. the willingness of employees can be called as attitude. what one needs to do with these elements to enhance the performance is to gather them and put them together after understanding the relationship between the four elements of performance. one needs to combine knowledge and skills for acquiring ability to perform. research methodology aim of the paper in the light of considerations of the value of human resource and controversy of hrd paradigms, our main objective in this paper is to identify the element that can help process and promote learning to realize the objective of sustainable and optimal performance of the employees with the help of which organizations can outperform their competitors, dominate their respective markets and win the position of sustainable competitive advantage. we begin our thesis by examining the concepts of learning and performance. this lays the foundation for determining the elements that can cause and sustain the process and promotion of learning. research question the following question will lead us through this paper: what are the elements that make it possible that learning is processed and promoted to achieve the end of effective performance and how these elements are utilized for the intended purpose? learning paradigm versus performance paradigm in the recent times two approaches i.e., learning paradigm and performance paradigm have become famous in respect of achieving the level of optimal performance. in the opinion of song, kim & kim (2007) in the earlier times (mid-1900s) hrd practioners considered “training and development” more important. their main emphasis was on improvement of individuals’ knowledge, skills, and attitude through short-term and at-the-spot training programmes. on this basis it was expected that the results of training came out immediately. later, the focus shifted to the learning process of individuals and organizational improvement with the help of integrated learning process. both the paradigms have their claims regarding the realization of performance of workers and organizations. in the following lines both these paradigms are compared: scope of learning it is generally considered that the scope of performance paradigm in respect of imparting knowledge and skills to the workers is limited. in this connection, harrison & kessels (2003) observe that in performance paradigm, the hrd functions are concerned solely with learning inputs, improvement of individual performance and training-dominated activity. in the consequence of this approach individuals’ learning process or organizational performance improvement remains unattended to. hu (2007) also criticizes performance paradigm for its limited scope, as in this paradigm of hrd, policies and activities focus performance improvement or efficiency and negate everything else. contrary to the position of performance paradigm, hrd as an organizational process encompasses skillful planning, facilitation of a variety of formal and informal learning and knowledge processes and experiences for the purpose of enhancing organizational progress and individuals’ potential with the help of competence, adaptability, collaboration and knowledge-creating activity of employees and managers of the organization. south asian review of business and administrative studies vol. 1, no. 2, dec 2019 103 seeing the position of performance paradigm, it can be said that the rationale of hrd at individual level seems to be focusing on self-actualization and self-development through using a variety of learning concepts whereas at societal level also it is required to generate higher-order knowledge, skills, innovation, and sustainable development of a workforce to enhance the nation’s competitive advantage. therefore, need is felt that the scope of performance paradigm should be broadened to include the purposes for both individual hrd and national hrd. status of workers in the view of the advocates of performance paradigm human beings are merely capital investment in a system and their function is to produce value-added performance in the form of goods and services. contradicting the position of performance paradigm, duke & udono (2012) highlight the value of human resource saying that in all the establishments, whether private or government, people are the most influential and responsible resources for the success of an organization because it is they who set the agenda, objectives and strategies; design, produce and deliver the goods and services and control their quality for the organization. further, human beings in the workplaces do not put themselves as capital and insensate parts of systems for yielding returns on investment of corporate shareholders. hu (2007) advocates the concept of learning paradigm saying that hrd actually aims at enhancing the learning capacity of individuals, groups and organizations through developing and using learning based interventions so that organizational growth and effectiveness is optimized. structure of organization both the paradigms have different stands in respect of structure of organization. in this regard, harrison & kessels (2003) say that till the end of the 20th century the structure of the organization was considered a static concept as the formal strategic decisions of the management conceived them to be. but when the age of knowledge economy started, it was acknowledged that regular structural reconfiguration of the organization must correspond to continuing changes in strategy when new stocks and resources within the organization are acquired or existing ones transferred to other sites and when the firm creates value through an interaction with its customers. in other words, strategy and structure need to become interactive processes that cause the continuous creation, acquisition and exploitation of knowledge and expertise in the domain of a firm. instructional interventions as regards the interventions used for the improvement of performance, both the paradigms are at cross purposes. peters (2007) criticizes performance paradigm in connection with short-term interventions which are employed to improve performance and they address only a single aspect of performance. peters elaborates his point thus: “for example, a training program designed to increase the ability of people to work on high performance teams is often rendered useless by an unsupportive or even hostile culture and the negative attitudes of participants who realize this is ‘just not the way we do things around here’ (p.4).” through this example, peters wants to say that the training gives knowledge and skills to perform on the respective task and not to address the cultural and attitudinal issues (hostile culture and poor attitudes) that create un-surmountable hurdles for the trainees. in short, narrow trainings given under performance paradigm do not enable functionaries of an organization to transfer their limited and local learning to their jobs and little improvement takes place in overall performance. harrison & kessels (2003.) but these researchers suggest that for adding critical value in a knowledge economy by hrd process, lifelong learning and work-based strategies should be given priority as compared to giving focus on immediate performance improvement. this preference is necessary because in knowledge economy, hrd experts should go for learning processes that can generate and spread knowledge for enhancing the organization’s capability to improve and innovate continuously. these researchers continue to say that “in a knowledge-based economy the source of competitive advantage cannot be south asian review of business and administrative studies vol. 1, no. 2, dec 2019 104 knowledge as organizational commodity alone, since the value of all commodities is eroded by obsolescence, imitation and poaching. what is needed is a new paradigm of the organization one that presents it as a system of learning and knowing processes and activity that are situated in workplace communities of practice (p.8).” the stand of learning paradigms seems more valid when the current world is seen in respect of rapid changes and novel and uncertain developments. motivation of the workers the advocates of both the paradigms are in different camps with the reference to how the motivation of workers occurs. focusing on the position of performance paradigm, peters (2007) says that the organizations that follow performance paradigm, through narrowly focused interventions to address complex performance problems, create more and more management problems and ultimately management credibility is destroyed. their employees begin to develop negative attitudes and management becomes frustrated despite its continued investment and things do not seem to improve. this situation turns into trust deficit and blaming and ultimately adversarial relationship develops between management and employees. in the same line franklyn (2009) criticizes the ways of motivation followed in performance paradigm. he says that in performance paradigm personnel management typically tries to motivate employees through compensation, bonuses, rewards, and the simplification of work responsibilities. this approach is followed because, according to the personnel management, employees’ satisfaction generates the required motivation necessary for the improvement of job performance. franklyn is of the view that it is not the satisfaction of the employees that leads to motivation and improvement of job performance but it is improved performance that brings about employees satisfaction. opposite to the advocates of performance paradigm, human resource management considers work groups, effective strategies for meeting challenges, and job creativity (attributes of learning paradigm) are the primary motivators. both the paradigms share a common ground the scopes and aims of performance paradigm as well as learning paradigm have been examined above. if performance paradigm is utilized, optimal performance that is the objective of hrd process cannot come out until integrated learning does not play its role. wang & huang (2013) observe that predominant paradigms in human resource i.e., performance paradigm and learning paradigms, both exist side by side. the scholars have recently acknowledged that both paradigms are not mutually exclusive. it follows from this view that these paradigms should not be presented as contestants but needed to be integrated as complementary ones. hu (2007) also acknowledges that both the paradigms share the common ground in the area of theoretical foundations of hrd. on account of this sharing various learning theories added new knowledge to the conceptual framework of hrd and have become popular in hrd practice. particularly, learning theories like reflective learning, experiential learning, transformative learning and social learning have firmly won space in the arena of human resource development research as well as practice. discussion it has been seen in the observation above that the performance paradigm cannot bring in sustainable and effective performance and growth. on the other side the learning paradigm seems promising because it can endow capacity to human beings to interact and solve complex performance problems or attitudes that can prove roadblocks in the path of performance. but at this stage two questions arise: 1. what is required through learning? 2. how learning can be processed and promoted to generate the required learning capacity in human resource? south asian review of business and administrative studies vol. 1, no. 2, dec 2019 105 target of hrd focus of the first question given above is the target of hrd. this target may be defined as the optimal performance of an organization. rationale of this target and so far efforts made and movements launched to achieve it have been mentioned in the beginning of this paper. in simple words, this target is the achievement of a matchless position of an organization on account of a unique learning capability of its workforce. a familiar term, ‘sustainable competitive advantage’ can introduce the said matchless position well. wright et al. (1992 cited in hu, 2007) suggest criteria for a sustainable competitive advantage and then mention conditions in which human resource can meet these criteria: human resource must provide value to the organization and they must be rare, inimitable and must not have substitute. strategies for hrd success the second question given above pertains to the way the hrd professionals need to process and promote learning to achieve their target of optimal learning or sustainable competitive advantage through enhancing the learning capacity or capability of human resource. in the words of 2007 strategic review their challenge is to fill “the gap between current staff competences and the desired staff competency profile (p.51).” filling this gap has a high demand on the hrd professionals. to meet this demand following strategies can be effective. reciprocal learning human societies have made economic and social progress with the help of learning and development of knowledge which were acquired through information sharing process. although the knowledge increases with sharing, yet it stays in individual and collective subconscious of human beings which is commonly known as tacit knowledge. human beings retrieve and utilize this knowledge unconsciously in their routine and skill-based tasks. according to held (2012) employees generate the knowledge on reciprocal basis. but the knowledge produced thus does not aggregate itself to the level of the organization. within the organizations, groups are founded where employees share their understanding, interpretations, attitudes and knowledge. this process leads to group level learning. the knowledge that thus comes into existence within these groups becomes institutionalized as an organizational product. for the sake of learning and knowledge generation employees should be able to interact and work independently in different compartments of the organization. on the other hand the organization should utilize the learning capacity of its employees. it should rather make goals and structures obvious and enhance the culture of sharing to develop a culture of learning. in line with held, harrison & kessels (2003) say that envisaging the importance of partnership process, now more attention is being directed to ways how workplace communities can be brought together and make them share organizational purpose while keeping intact the unique self-regulating characteristics which are very dear to individuals and so powerful in driving the knowledge process. it follows from this position that in a knowledge-creating organization focus should be more on finding new ways to make people think creatively and feed their thoughts back into the organization as compared to developing systems to control learning or to manage knowledge. further, focus should be on to provide the skills and support systems that are required to manage the projects that emerge from that creativity. continued learning: the 21st century is an age when things are happening and developments are taking place on fast-track basis on account of exceeded interconnectivity and global economy. it means the current age is a dynamic age and the workers of this age need to update their learning as the life go forward. anonymous (n.d.) emphasizes the continued learning for the purpose of updating people about the latest technology, skills, etc. this type of learning can generate high skilled and flexible workers and managers; career development opportunities; employment and retaining opportunities; and promoting creativity and technological development within the south asian review of business and administrative studies vol. 1, no. 2, dec 2019 106 workforce. in view of this type of needs, the hrd professionals should try to cause continued learning. training and development employees’ training and development is generally required when some changes occur in the way of doing things on account of technology or organizational developments. and the purpose of training is to enhance employees’ performance and productivity. according to duke & udono (2012) training generally pertains to “upgrading, re-tooling and skills-optimization activities... training and development usually come in the form of orientation, skills training and executive development... this activity has implications, not just for raising employees’ skills levels, but also for increasing their motivation – a factor that is critical for job satisfaction, productivity and long term commitment to the organization (p.160).” seeing the importance of training, the professional develop training programmes and provide for the human resource on continuous basis. however, they should understand that the success of a training activity depends on this condition that the learning occurred in training can be transferred to the job situation or newly gained skills are put into use. perceptions, attitudes and behaviours of employees in respect of the success of an organization which in its turn becomes possible only through positive perceptions, attitudes and behaviours of the employees. according to peters (2007) in connection with the employees’ performance, their perceptions are important because they are thought to precede individual behavioural reactions which are the most direct reaction to hr practices. it is also important to note that employee’s perception is the result of the learning the employee does. held (2012) also emphasizes that it is very important to consider employees’ perception. employees’ positive perception about hr practices will ultimately cause improved performance. there are three sorts of hr practices: (1) the intended hr practices, (2) implemented hr practices, and (3) perceived practices. it is required to understand how hr practices are implemented in the light of the intentions of the organizations while incorporating the employees’ perceptions. here the point is that that employees perceive about the opportunities for learning in a different manner as compared to the approach of a manager. however, managers can promote the learning of their employees through shaping a work situation and rewards. now the question is how attitudes, that may prove restraints in the path of performance, can be changed. hase & davis (1999) inform us about the way attitudes can be changed. they say that for changing attitudes first changes should be made in behaviour. and this can be done successfully through work activity and pre-start meetings. incidental learning anonymous (n.d.) says that learning at work is usual but incidental learning is which occurs during the performance of tasks. various new facts and theories emerge when the workers are engaged in their work. this emergence provide chance to learn new things and this learning adds to the motivation of workers. however, chances of this type of learning are very few according to harrison & kessels (2003) in workplaces where technology is being used increasingly. in the absence such chances, motivation to learn new tasks, develop new work behaviours and master new work practices is a great requirement. the problem of less motivation can arise because technology cannot build the required motivation. in this situation hrd experts should come forward and try to promote productive social interaction in and across teams. conducive work environment conducive work environment is an atmosphere that is quite essential for realizing effective performance in business organizations. building and sustaining knowledge-productive enviroment demands expertise and credibility from hrd professionals. according to harrison & kessels south asian review of business and administrative studies vol. 1, no. 2, dec 2019 107 (2003) for the purpose of producing positive environment, professionals require to master strategizing, organizing and hrd processes supportive for innovative organizational forms. through these skills they can create among employees the interacting type of competencies, i.e., strategic capability, flexibility and learning orientation. learning capacity/capability co-occurring of knowledge economy and globalization has led hrd scholars to the conclusion that innovation and flexibility instead of efficiency are the main drivers of value and competitive advantage can be achieved through capability to adapt to and meet unfamiliar challenges by producing and applying new knowledge to continuous improvement. harrison & kessels (2003) make it clear that “in an economic environment where knowledge is becoming the main organizational currency, firms must be able to learn fast, respond to recurrent unfamiliar challenges, and ensure that their workers can construct and share strategically valuable knowledge as well as acquire technical and interactive skill (p.1).” in short, in the current turbulent times the thing which is required is learning capacity or capability. according to held (2012) the learning capacity is the form of superior or enhanced learning that should be installed at the individual, group and organizational level. this capacity enhances the employee’s knowledge/awareness regarding how to learn. hase & davis (1999) call this learning capacity ‘capability’ and says that capable people know how to learn; they are creative; have a high degree of self-efficacy; can apply competencies in new as well as familiar situations; and work well with others. further, these researchers differentiate between competency and capability saying competency pertains to the acquisition of knowledge and skills and is an essential ingredient of being capable, whereas capability is a holistic attribute. as capable people possess ‘all round’ capacity, they are more likely to be able to effectively handle the critical circumstances when they face them in workplaces. in the light of the views given above it is recommended that the hrd professionals orient and enable their human resource to produce and apply knowledge. transference acquiring knowledge is one thing and its application is another thing. a general drawback of training programs in performance paradigm is that information is given to the participants; they remember it but cannot use it in new environments. the thing they actually require is the ability of transfer. explaining the concept of transference, westover (2008) says “transference refers to one’s ability to use the information and skills attained through training in a new environment, ideally the work environment (p. 6).” certain factors can increase the likelihood of transference. particularly, association and similarity are more prominent. for example, trainees can associate newly received information with something already in their minds or if they receive information that is similar to their previous information, more transference will occur. knowledge competencies in business organizations, workers need to perform many activities. for the performance of such activities they require some procedural or regulative knowledge which can be called as knowledge competencies. this type of knowledge is generally acquired through formal education, training and experience. lindner (2001) elaborates this concept saying, “some human resource management knowledge, such as constructing a markov matrix, would almost always be acquired through formal education. other knowledge, such as conducting an interview may be acquired through training and life experiences (p.342).” it is necessary that employees acquired knowledge of human resource policies and practices e.g., laws and regulations to perform hrm activities. for the effective performance of hrm activities, hrd professionals should supply this kind of knowledge to their employees. south asian review of business and administrative studies vol. 1, no. 2, dec 2019 108 conclusion this study is conceptual and non-empirical. this is its main limitation. there is a need for further empirical study so that approach suggested in the paper can gain an established effect. further, since the things stated in the paper are essentially recommendary in nature and in no way prescriptive, other complementary information gleaned conceptually or empirically will be useful. it is recommended that strategies, to realize optimal performance, suggested in this paper be empirically tested for their effect in a context of an organization. in the present day world where things are changing rapidly and new developments are taking place in an uncertain manner; where people require decent employment and societies require peace and development, the human resource needs be developed and utilized in a very efficient manner. for this purposes various approaches have been employed so far. particularly, performance paradigm and learning paradigm are worthy of note. however, both these paradigms have not succeeded in providing the complete answer to the question how optimal performance can be ensured. the researcher has the view that these paradigms are complementary to each other and the problem of optimal performance would not be solved by sticking to one of the two. rather, learning paradigm need be restructured to incorporate a number of strategies following which it may become possible to process and promote learning to realize the optimal learning which in its turn generate possibilities for firms to attain the position of sustainable competitive advantage. references anonymous (n.d) uman_resource_development_importance_of_learning_in_ people _develo pment, braviaresearchpapers.com/.../ retrieved on 25 october 2014 duke, j. & udono, e. n. (2012) a new paradigm in traditional human resource management practices journal of management and sustainability; vol. 2, no. 2; canadian center of science and education franklyn, ch. (2009) the development of human resource management from a historical perspective and its implications for the human resource manager books.google.com retrieved on 25 october, 2014 harrison, r. & kessels, j. (2003) human resource development: key organisational process in a knowledge economy proceedings of the fourth international conference on hrd research and practice across europe, toulouse, france (2003) hase, s & davis, l (1999), 'from competence to capability: the implications for human resource development and management', paper presented to millennial challenges in management, education, cybertechnology, and leadership: association of international management, 17th annual conference, san diego, 6-8 august. epublications@scu held, h. e. (2012) can individual, group and organizational learning explain the human resource development employee performance relationship? retrieved on 25 october 2014 from http://essay.utwente.nl/62440/1/held,_h.e._-_s0163228_(verslag).pdf hu, p. (2007). theorizing strategic human resource development: linking financial performance and sustainable competitive advantage. in f.m., nafukho & t. chermak (eds.), proceedings of the academy of human resource development 2007 international research conference. fayetteville, ar: university of arkansas. lindner, j. r. (2001) competency assessment and human resource management performance of county extension chairs journal of southern agricultural education research volume 51, number 1, 2001 mojtahedzadeh, r. &izadi, r (2013) the impact of human resource management on performance of oil and gas industry in iran global journal of biodiversity science and management, 3(2): 175-181, 2013 peters. d. a. (2007) the performance equation – unifying theory of human performance, doug peters ds performance group from www.dsperformancegroup.com retrieved on 25 october, 2014 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 109 roma, m. a., (2003) human resource development project: state farm insurance company learning and development department, q310 ss2003 project simmonds and pedersen, (2006, p.122 cited in anonymous n.d.). uman_resource_ development_importance_of_learning_in_people_development, bravia research papers.com /.../ retrieved on 25 october 2014 song, j., kim, y. & kim, j. y. (2007 ) a study on value-perception priority of human resource development (hrd) practitioners for workplace learning and performance (wlp) in the korean context, presented at the academy of human resource development international research conference in the americas (indianapolis, in, feb 2007) swanson and halton (2009, cited in anonymous n.d.) human_resource_development_ importance _of_learning_in_people_development, braviaresearchpapers.com/.../ retrieved on 25 october 2014 strategic review of human resource management in unicef, © united nations children’s fund (unicef), new york, 2007 unicef, 3 un plaza, ny, ny 10017 wagner, j. (2008) skills development for employment: scope and strategies, a paper presented at international conference in bali/indonesia, 24-26 november 2008 in partnership with unesco-unevoc international centre (bonn) and the southeast asian ministers of education organization regional centre for vocational and technical education and training (seameo voctech) wang, y-l, & huang, s. (2013) organizational learning and human resource: a review of the theory and literatures ipedr. 2013. v61. 12 westover, j. h., (2008) effective human resource training and development: examination and application of adult learning theory in the hr management context the journal of human resource and adult learning vol. 4, num. 1, june 2008 wright et al. (1992 cited in hu, p. 2007) theorizing strategic human resource development: linking financial performance and sustainable competitive advantage, in f.m., nafukho & t. chermak (eds.), proceedings of the academy of human resource development 2007 international research conference. fayetteville, ar: university of arkansas. south asian review of business and administrative studies vol. 1, no. 2, dec 2019 110 south asian review of business and administrative studies vol. 1, no. 1, june 2019 1 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.1, june 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas fostering workplace belongingness through job crafting and appreciative leadership: evidence from pakistan private higher education institutes ghazanfar ali, universiti utara, malaysia afaq ahmad, school of business administration, zhongnan university of economics and law, china article details abstract history revised format: may 2019 available online: june 2019 keywords workplace belongingness, affective commitment, job crafting, appreciative leadership workplace belongingness has never been an easy task in exerting in the employees’ minds. it entirely relies on the employees’ perception which builds from the perceived organization's support and workplace relations. if employees perceive this support is negligible then the sense of low belongingness, disengagement and turnover intention formed in their minds. the main aim of the study is to measure the effect of job crafting, appreciative leadership on workplace belongingness, as well as the mediating effect of affective commitment. adapted questionnaire by conducting the face validity with 5-point likert scale was used; random sampling technique was used to obtain the responses from the 40 faculty members in private universities of pakistan. the study used cross-sectional design. the findings show that appreciative leadership has a positive effect on workplace belongingness and affective commitment. however, job crafting has insignificant effect on workplace belongingness, although, positive effect on affective commitment. affective commitment has significant mediating effect between appreciative leadership, job crafting and workplace belongingness. for future study, organizational justice can be used to promote the workplace belongingness. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: ghazanfaraliiub@gmail.com doi: https://doi.org/10.52461/sabas.v1i1.434 introduction in the context of pakistan, the structure in private universities of pakistan is autonomous, and have been facing continuous changes (zulfqar & valcke, 2014). the changes such unnecessary authority is given to the registrars and the vice-chancellors (sial, jilani, imran, & zaheer, 2011), and poor governance of universities lack of accountability have also been prevailing in the highereducation institutes (sial et al., 2011). https://journals.iub.edu.pk/index.php/sabas https://doi.org/10.52461/sabas.v1i1.434 south asian review of business and administrative studies vol. 1, no. 1, june 2019 2 likewise, lack of physical resources (yusoff & khan, 2013), lacking in management support (danish & usman, 2010), and also the issue of low autonomy has been occurred (khan, khan, & imran, 2018; yusoff, khan, & azam, 2013). when employees find such happenings unsupportive or unfavorable then the perception of low workplace belongingness comes in their mind, that consequently generates job dissatisfaction and negative behaviors that cause problem to the management in terms of turnover (dewall, baumeister, & vohs, 2008). at the workplace employees’ belongingness is the predictor of psychological wellness for example employees’ satisfaction (borrott, day, sedgwick, & levett-jones, 2016; josling, 2015; skaalvik & skaalvik, 2011). according to some studies psychological distress in terms of depersonalization, psychological demand, lack of self-fulfillment and emotional burnout can also be reduced through workplace belongingness (coissard, ndao, gilibert, & banovic, 2017). workplace belongingness has also been observed as the predictor of increased engagement (josling, 2015) and decreased turnover intentions (jeswani, dave, & shankaracharya, 2012). the teaching profession has also faced and still facing the issue of low belongingness at the workplace and this turned to be a main concern for the researchers, faculty members and management (hiatt, mc letchie, bagasra, laufersweiler-dwyer, & mackinem, 2019). belongingness at the workplace reduce turnover intentions (o'relilly & robinson, 2009). in the context of pakistan, the private sector universities administration has been facing the serious problem of turnover intention of their academic staff (usman & jangraiz, 2015). work over load and in return higher disadvantages is the main reason of turnover intention in the private universities (usman & jangraiz, 2015). a report of booz (2018) shows the results below in table 1 that the technology sector such as software has the most turnover rate in 2017 at 13.2%. retail and consumer products have the turnover rate in 2017 at 13.0%, while media & entertainment have the turnover rate in 2017 at 11.4%, professional services have also the turnover rate in 2017 at 11.4%, and education sector has the turnover rate in 2017 at 11.2%. this report shows that turnover is prevailing among faculty members all over the world especially in private educational sector. table 1: turnover ratio sr.# organization turnover ratio 1 software 13.20% 2 retail and consumer products 13.00% 3 media and entertainment 11.40% 4 professional services 11.40% 5 education sector 11.20% 6 financial service and insurance 10.80% 7 telecommunication 10.80% sources: report of booz (2018) furthermore, specifically in the context of pakistan private sector universities, academic staff’s disengagement is also another important issue that force them to quit from their jobs (saleem & qamar, 2017). the feelings of being disengaged at the workplace arise from the low level of workplace belongingness (josling, 2015). on the other hand, the higher level of belongingness at work lead towards the meaningful engagement among the employees (chan, 2016). south asian review of business and administrative studies vol. 1, no. 1, june 2019 3 according to the gallup (2017), only 15% of employees in service sectors of pakistan are engaged, 68% not engaged and 16% are actively disengaged which are shown in table 2. pakistan is on top regarding disengagement in comparison with sri lanka and india. table 2: employees engagement in service sectors country engaged not engaged actively disengaged pakistan 15% 68% 16% sri lanka 14% 62% 24% india 9% 60% 31% source: (gallup, 2017) hence belongingness at workplace is the predictor of decreased employee disengagement (josling, 2015) and decreased turnover intention (o'relilly & robinson, 2009). therefore, in order to ensure the higher level of workplace belongingness this study is aimed to determine the effect of appreciative leadership and job crafting on workplace belongingness with the mediating effect of affective commitment among the academic staff of private universities of pakistan. literature review the main purpose of the study is to examine the effect of appreciative leadership, job crafting on workplace belongingness with the mediating effect of affective commitment. workplace belongingness the basic human need is to have the sense of belonging and this sense is also the main source of motivation for the individual (maslow, 1954). baumeister and leary (1995) described that need to be belong as a “strong desire to form and maintain meaningful interpersonal attachments. according to the hagerty, lynch-sauer, patusky, bouwsema, and collier (1992) when employees get involved in the environment or in the system then sense create the feelings of being engaged that make them realized that they have become very important part of this system or environment. hagerty et al. (1992) further stated that the sense of belongingness can be injected in the employee’s mind through mutual collaboration. the concept of belongingness at workplace has its own distinction comparing the similar concepts like job satisfaction, loyalty and trust level of the job, basically workplace belongingness is the predictor of such happenings at the workplace (jena & pradhan, 2018). researchers jena and pradhan (2018) belongingness at work is the positive experiences in the form of interpersonal engagement just to be the part of the entire system. one more definition of sense of belongingness is to what extent employees feels that they are supported, respected, included and accepted by the management in the organizational setting (cockshaw & shochet, 2010). likewise, derrick, gabriel, and hugenberg (2009) specified that belongingness cannot be attained through just personal association, but other important aspects also play very important role in developing the sense of belongingness such as a child’s blanket that used for safety and the feelings of child can develop the sense of belongingness. following the other statement is given by baumeister and leary (1995) that sense of belongingness prevails when the non-intimate associations occurs like political/occupational motivations. job crafting wrzesniewski and dutton (2001) stated that job crafting means employees alter their job demands and by doing so they make their job enjoyable that is linked with their interest, passion and capabilities/demand. job crafting is also explained by tims, bakker, and derks (2013) as “a specific type of proactive work behavior that employees engage in adjusting their jobs to their south asian review of business and administrative studies vol. 1, no. 1, june 2019 4 needs, skills, and preferences” (p. 428). likewise, job crafting is like autonomy that employees enjoy by modifying their jobs and resources in order to get more engaged and satisfied with their work (tims, bakker, & derks, 2015). one more definition of job crafting is all about modification to adjust competencies, relationships to make the task more interesting and meaningful to improve self-worth (slemp & vella-brodrick, 2013). belongingness theory says that when employees develop a meaningfulness connection through using the cognitive process, then the sense of belongingness prevails in their minds (baumeister & leary, 1995. moreover, hypothesis of the belongingness suggest that with the help of cognitive thought process the belongingness and interpersonal relations mounted (baumeister & leary, 1995). hence job crafting is quite useful in the workplace setting as it provides support, ensure rewarding interactions and cultivate belongingness and meaning at the place of the work (baumeister & leary, 1995; berg, grant, & johnson, 2010). appreciative leadership showing appreciative attitude is a good sign of supportive leadership. though the concept of ‘appreciative leadership’ has seen more in the literature of popular management than in scientific publications, but scholars from the field of leadership shown concerns about the praise and recognition at the workplace as appreciative behaviors (apostel, syrek, & antoni, 2018), such behaviors give employees respect and dignity (eckloff & van quaquebeke, 2008), ensure constructive feedback on their performances to increase their productivity (london, 2003), social support (stajkovic & luthans, 2003) and also psychological support (constable & russell, 1986) appreciative leadership can be defined as the leadership supportive behaviors in terms of giving praise on their achievements, skills and appreciating their determinations and efforts (stocker, jacobshagen, krings, pfister, & semmer, 2014). moreover, researchers stocker, jacobshagen, semmer, and annen (2010) explained appreciative leadership gives compliments when employees done a good job, recognize the efforts and welcome one’s help so on. based on the belongingness theory, employees emotional attachment, belongingness and identification can be increased when they receive appreciation from their supervisors (baumeister & leary, 1995). therefore, in accordance with the appreciative theory, leadership is very useful tool in enhancing the belongingness at work. affective commitment the concept of affective commitment is referred to the employee’s emotional attachment, involvement and identification for the job and the organization (meyer & allen, 1991). this illustrate that instead of having some economic rationale, employees like to stay in the firm because of their own sake (meyer & allen, 1984). employees when get emotionally attached with the firm then they show affective commitment, then they experience belongingness at work and perceive themselves as a part of the organization. generally, there are three distinctive constructs namely, normative, continuance and affective commitment. based on the suggestions of belongingness theory individuals make their interpersonal relations and tasks significant through cognitive processes (baumeister & leary, 1995). likewise, according to the belongingness theory people are dependent on their cognitive thought process in developing attachments to enhance the sense of belongingness (baumeister & leary, 1995). the feelings of attachment and belongingness are likely to generate when people strive for crafting to create meaningful relation and tasks with the help of cognitive process (dash & vohra, 2019). on the same note, when employees practice crafting to make their interpersonal relationship meaningful then they are anticipated to experience the emotional attachment and feelings of belongingness both for the job or for the organization (dash & vohra, 2019). south asian review of business and administrative studies vol. 1, no. 1, june 2019 5 belongingness theory further explained, supervisors behaviors towards appreciating the employees effort and achievement is linked with the need of being emotionally attached and belonged (baumeister & leary, 1995). moreover, in accordance with the belongingness theory, appreciation by the leaders enhances employee’s affective commitment that leads to the increased sense of belongingness. likewise, sense of commitments prevails in employees mind when they receive appreciation and recognition on their task accomplishment (peter, peter, & catapan, 2015). h1: there is a positive effect of affective commitment on workplace belongingness h2: there is a positive effect of appreciative leadership on affective commitment h3: there is a positive effect of job crafting on affective commitment h5: there is a mediating effect of affective commitment between appreciative leadership and workplace belongingness h6: there is a mediating effect of affective commitment between job crafting and workplace belongingness. methodology the current study is quantitative with a cross-sectional approach. data were collected from the private universities of pakistan. this study uses the faculty members of private universities as a population for many reasons. in private universities, faculty members have more turnover intention rather than faculty members of public universities (nawaz, 2016). in the current study 40 faculty members of private universities were used as a sample size. simple random sampling technique was used to collect the data. face validity has been conducted of each scale by two experts of university utara malaysia; one is from the public universities of pakistan and two experts from the private universities of pakistan. the scale of workplace belongingness was developed with 12 items by (jena & pradhan, 2018). the scale of job crafting was developed with 15 items by (slemp & vella-brodrick, 2013). the scale of appreciative leadership was developed with 3 items by (rafferty & griffin, 2004). the scale of affective commitment was developed with 8 items by (meyer & allen, 1997). majorly, the analysis of this study is based on two parts. first part is comprised of measurement model assessment. second part is comprised of structural model assessment in which hypotheses were tested. moreover, r-squared (r2) value, effect size (f2) and quality of model is also addressed in this part. findings & discussion the first part to make data analysis in measurement model assessment (mma) is factor loading, cronbach’s alpha, composite reliability (cr) and average variance extracted (ave) (henseler, ringle, & sinkovics, 2009). (hair, black, babin, anderson, & tatham, 1998) stated that the value of factor lodgings must be >0.5 and below 0.05 should be erased. the value of alpha > 0.9 is excellent, 0.8 is good and < 0.7 is acceptable”. the cr must be >0.7 (george & mallery, 2003). furthermore, the value of convergent validity (cv), and ave should also be equal or >0.5 that leads to the internal consistency. additional, figure 1 demonstrates the values of the model mma. table 3 demonstrates the results of mma. it shows that all the values are acceptable. factor loading, cronbach alpha and cr are also >0.7. the factor loading items which have less than 0.7 values were deleted. in addition, ave is >0.5 that leads to convergent validity. south asian review of business and administrative studies vol. 1, no. 1, june 2019 6 table 3: cronbach's alpha construct s cronbach' s alpha rho_a composit e reliabilit y average variance extracted (ave) ac 0.959 0.96 0.966 0.779 als 0.767 0.861 0.863 0.684 jc 0.932 0.939 0.941 0.593 wpb 0.945 0.952 0.953 0.69 in addition, the validity of the constructs is measured through convergent validity (cv) and discriminant validity (dv). results find shown in table 3 that the values of ave for all the latent constructs are greater than 0.50 as stated by (chin, 1998). duarte and raposo (2010) argued that discriminant validity (dv) indicates that how much latent constructs is distinctive from others. the current study measures the discriminant validity (dv) through the method of fornell and larcker (1981) by taking the square root of average variance extracted of all the latent constructs as shown in table 3 with the bold value in the correlation matrix diagonal. the study results in table 4 show that the square roots of average variance extracted are greater. figure 1: measurement model assessment table 4: discriminate validity constructs af als jc wpb af 0.883 als 0.835 0.827 jc 0.791 0.612 0.77 wpb 0.898 0.706 0.877 0.831 the second part of the data analysis in structural model assessment (sma) of hypotheses both direct and indirect measurement. direct hypotheses for accepting or rejecting were measured as shown in table 4. all the relationships with t-value greater than 1.96 and p value is 0 less than south asian review of business and administrative studies vol. 1, no. 1, june 2019 7 0.05 would be accepted. thus, h1, h2 and h3 are accepted. however, h5 is rejected since t value is 1.457 less than 1.96 and p value is 0.146 greater than 0.05 in table 5. the relationship of ac > wpb with the β-value is 0.898. thus, for one unit enhances in affective commitment, the workplace belongingness would be enhanced by 0.898 units. the relationship of als -> ac with the β-value is 0.560. thus, for one unit increases in appreciative leadership, the affective commitment would be enhanced by 0.560 units. the relationship of jc -> ac with the β-value is 0.448s. thus, for one-unit increase in job crafting, the affective commitment would be enhanced by 0.448 units. table 5: direct relationship hypothesi s relationship original sample (o) sampl e mean (m) standard deviation (stdev) t statistics (|o/stdev| ) p values decision h1 ac -> wpb 0.898 0.9 0.016 54.705 0 accepte d h2 als -> ac 0.560 0.552 0.071 7.918 0 accepte d h3 jc -> ac 0.448 0.456 0.064 7.005 0 accepte d the method of bootstrapping analyses using 95 percent bias corrected and accelerated confidence intervals (cis) was employed over other methods of mediation testing (preacher & hayes, 2008). in the table 5, the results show that the mediating effect of affective commitment between appreciative leadership and workplace belongingness as the t-value 8.223 greater than 1.96, p value 0.000 less than 0.05 and β value 0.503 is significant. thus, h4 is accepted. similarly, in the table 5, the results show that the mediating effect of affective commitment between job crafting and workplace belongingness as the t-value 6.548 greater than 1.96, p value 0.000 less than 0.05 and β value 0.402 is significant. thus, h5 is accepted in table 6. table 6: indirect relationship hypothesis relationship original sample (o) standard deviatio n (stdev ) t statistics (|o/stdev |) p values decision h4 als -> ac -> wpb 0.503 0.061 8.223 0 accepted h5 jc -> ac -> wpb 0.402 0.061 6.548 0 accepted in the end, the quality of model is measured through construct cross-validated redundancy called predictive relevance (q2). achieving a certain quality of model, the value of q2 should be greater than 0 (chin, 1998). the value of q2 of affective commitment is 0.593 >0 and workplace belongingness is 0.501 >0 in table 7. table 7: predictive relevance constructs sso sse q² (=1sse/sso) ac 1,360.00 553.697 0.593 als 510 510 jc 1,870.00 1,870.00 south asian review of business and administrative studies vol. 1, no. 1, june 2019 8 wpb 1,530.00 764.232 0.501 the main purpose of the current study is to examine the effect of job crafting, appreciative leadership on workplace belongingness including mediating effect of affective commitment among faculty members in private universities of pakistan. workplace belongingness as the extent to which the individual feels personally accepted, respected, included and supported by others in the organizational environment. however, affective commitment is an employee’ sentimental or emotional attachment, sense of relatedness and involvement in the organization. it is found that affective commitment has positive effect on workplace belongingness with t-value 54.705 > 1.96. β-value 0.898 and p value 0.000> 0.005 are found significant and positive direct effect of ac on wpb. the current finding is acknowledged the previous studies such as (dávila & garcía, 2012; waardenburg, 2016) that affective commitment in terms of emotional attachment enhances the workplace belongingness. according to belongingness theory, being appreciated by the supervisors relates to the need of emotionally attachment and the sense of belongingness (baumeister & leary, 1995). the faculty members who are emotionally attached with the workplace also feel belongingness to their universities. moreover, appreciative leadership who acknowledges one’s effort by giving rewards, appreciate one’s help, and assign interesting tasks when one has done a good job. in the current study, the appreciative leadership has significant effect on affective commitment with t-value 7.918> 1.96. β value 0.560 and p value 0.000> 0.005 are found significant and positive direct effect of al on ac. there is not found direct relationship between these two constructs. however, the finding is indirectly in line with the previous studies such as nyakaro (2016) shown that recognition on work has positive affective on affective commitment. according to the belongingness theory that the appreciation from supervisor enhances the feelings of affective commitment in terms of emotional attachment (baumeister & leary, 1995). the appreciated faculty members in terms of recognition and rewards feel emotionally attached with their universities. further, job crafting is the process of employees redefining and reimagining their job designs and personal relationship in the meaningful ways. in the current study, job crafting has significant effect on affective commitment with t-value 7.005> 1.96. β value 0.448 and p value 0.000> 0.005 are found significant and positive direct effect of job crafting on affective commitment. the finding is aligned with the previous studies such as (li, 2015), though, the findings of (qi, li, & zhang, 2014) shows that affective commitment has positive effect on job crafting. in the belongingness theory hypothesis suggests that people devote much of their cognitive thought process to interpersonal relationships and attachments (baumeister & leary, 1995. faculty members who craft their job build their emotional attachment with the universities. it is found that the mediating effect of affective commitment between appreciative leadership and workplace belongingness with t-value 8.223> 1.96, β value 0.503 and p value 0.000> 0.005 are found significant effect. there is no finding in the previous studies on this mediating relationship. according to belongingness theory, being appreciated by supervisors relates to the need of emotionally attached and the sense of belongingness (baumeister & leary, 1995). faculty members who appreciated by their deans and top management are emotionally attached with the workplace and have the strong sense of belongingness. it is found that the mediating effect of affective commitment between job crafting and workplace belongingness with t-value 6.548> 1.96, β value 0.402 and p value 0.000> 0.005 are found significant effect. there is also no finding in the previous studies on this mediating relationship. when individuals craft their relation and work to making it meaningful and valuable by using the cognitive process, the feelings of south asian review of business and administrative studies vol. 1, no. 1, june 2019 9 emotional attachment and belongingness developed (dash & vohra, 2019). the faculty members craft their jobs this sense arouse their attachment toward the sense of belongingness at workplace. conclusion the present study concluded that in the centralized firms where employee’s turnover ratio and their disengagement level are high, so in the private sector universities faculty member get better and perform well when they are appreciated, rewarded and recognized by the top management like dean and vice chancellor. appreciation by the management makes the employees emotionally attached with their jobs and workplace and moreover fosters the sense of belongingness as well. following the same, employees experience emotional attachment through affective commitment as it plays very fundamental role in mounting the workplace belongingness of the employees. moreover, academic staff via affective commitment by getting emotionally attached does involve themselves in job crafting that eventually lead towards the higher level of workplace belongingness. instilling the sense of workplace belongingness is mind of academic staff is difficult task. the reason is centralized structure in the private universities of pakistan and because of this faculty member are less autonomous. further, they feel that they are being compelled to do their job. due to this unfriendly work environment, high turnover intention and feelings of disengagement are likely to prevail among the academic staff members. in order to ensure higher level of engagement and low turnover intentions, management needs to take some necessary steps. management should give employees the sense of autonomy to faculty members in terms of job crafting. job crafting has been observed to increase workplace belongingness via affective commitment. moreover, appreciation should be given to faculty members on their performance and achievements in the form of promotions and increasing increments. such steps are essential for reducing turnover intentions and disengagement among the academic staff of the private sector universities of pakistan. this study has some limitation that can be addressed for the future research. first the sample size of this study is limited to only 2 provinces of pakistan namely punjab and sindh and only covered the faculty members of private sector universities, in future across the pakistan and from the public sector universities sample, can be taken. workplace belongingness can be studied as a behavior so in future in order to get the in-depth analysis faculty members can be interviewed by the researcher. organizational justice is the important predictor of enhancing workplace belongingness so in future it can predict the sense of belongingness at workplace. references apostel, e., syrek, c. j., & antoni, c. h. 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(2014). what about university leadership in a developing country context?: unraveling the nature of transformational leadership and participative decision making. paper presented at the 7th international conference of education, research and innovation (iceri). south asian review of business and administrative studies vol. 2, no. 1, june 2020 53 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas impact of innovative brand experience on brand loyalty: mediating role of brand love saif ur rehman, technical education and vocational training authority, pakistan article details abstract history revised format: may 2020 available online: june 2020 keywords airqual, innovative brand experience, brand love, pia in pakistan the aim of study is to observe the impact of innovative brand experience on brand love, which in turn influences their brand loyalty in airline sector of pakistan. the study also examines the comparison between pia and another airline brand which are operated in pakistan. data was collected via self-administrative questionnaire from 505 passengers of different airline brands who have travelled before in airlines. spss and amos versions 21.0 were used to analyze the measurement and structural models. the research examined that in airline sector of pakistan role of innovative brand experience and airline service qualities have impact on brand love which develop the satisfaction and element of brand loyalty in consumer’s mind and it also help to pay premium price for their beloved brand. moreover, in comparison of pia and other airline brands there are difference in results of innovative brand experience and airqual’s impact on brand love. this research is conducted in pakistan only; there should be conduct a research between pakistan and other emerging countries which will give a better result for proposed model. moreover, comparative study can be conducted between pia and other airline brands which are operating domestically. this study is showing the mediating role of brand love between innovative brand experiences, airqual as independent variable and brand loyalty, willingness to pay price premium as dependent variable which was not discussed before like this. this study is given a detailed comparison between pia and other airline brands in airline industry of emerging countries like pakistan. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author email address: saifurrehman514@yahoo.com doi: https://doi.org/10.52461/sabas.v2i1.443 introduction enhanced customers’ expectations and demands are the outcomes of the rapidly growing and competitive business scenarios where the customer retention has become a major challenge for service industries particularly in airlines (ali et al., 2015). whereas providing the high standard services to the customers is also barred by the failure to be spot on in identifying the true desires https://journals.iub.edu.pk/index.php/sabas mailto:saifurrehman514@yahoo.com https://doi.org/10.52461/sabas.v2i1.443 south asian review of business and administrative studies vol. 2, no. 1, june 2020 54 of the customers (izogo & ogba, 2015). in current competitive business scenario airline firms are pushed to focus on looking for innovative methods to deliver established services and brand experience to gain competitive edge. cutting operational expenses, over-seeing shifting interests, and meeting the quality requisites are the challenges airlines are facing these days (baker, 2013). several researchers have empirically shown that customers’ perception of service standards is dependent upon the airline carriers’ market share, income, positive word of mouth, and customer retention which results in customer satisfaction and loyalty (fornell, anderson & lehmann, 1994; forgas 2010). djumahir (2013), found concrete brand-management strategies are gradually attractive an imperative. and brand experience is one of the vital contributors of customer’s brand satisfaction level (brakus 2009; iglesias 2011). whereas company’s mission statements are noticeably asserting on pleasant brand experiences to shape strong brand loyalties (verhoef 2009). but, airline companies seldom use this spectacle. thus, the companies must be extra conscious to introduce innovative brand experience for value addition and expansion of customer brand experience options. (hjalager, 2010). steady growth in pakistani air travel market of 9% during 2016-2017 and is projected to become 9.5% throughout the following 20 years (haq, 2015). this results demonstrate, that pakistani market for air travel is rapidly rising at a faster pace i.e. more than twice in comparison to global average, simultaneously, it reinforces the contention that developing economies will lead the future air travel showcase (haq, 2015). a unique brand experience results in sustainable competitive advantage, thus, it’s crucial to quantify the experience dependent on the brand instead of exclusively on client perspectives (aaker, 1989; ong, salleh, & yusoff, 2015a). besides, schmitt (2009) too emphasized to conduct further study to recognize how, consumer experiences a brand. detailed literature assessment clarifies the researches on, brand experience are weaker in eastern countries and advanced in western countries. differences between the behavioral patterns of eastern and western consumers further support the demand of research study in malaysia (kandampully 2015). research conducted by ong et al. (2015a, 2015b) on brand experience in air-line industry, ignored the individual effects of its each dimension on loyalty. additionally, brand experience has a positive relationship with loyalty where the later prompts benefit (reichheld & sasser, 1990). industry report had likewise fortified the significance partner client involvement in qualities to improve business execution (company & mckinsey2016). to understand the brand relationship is important due to recognize brand loyalty. conceptualized as enduring associations with that brand rely on profound, hidden emotions towards it (fournier 1998). several current researches have checked that the buyers can create a feeling of love toward brand albertet al 2008a; batraet al 2012). madden shimp (1988) studies of brand love focused on its, conceptualization (ahuvia, 1993) and measurement (ahuvia & carroll, 2006). nevertheless, brand love has developed as a energetic construct of consumer brand relationship, still a little is known about what creates an love relationship (e.g. trust) what its, behavioral outcome might be (e.g. repeat purchase). ahuvia and carroll (2006) and (batraet et a. 2012) proposed that brand or product characteristics (e.g., brand quality, hedonic product) might be the brand love antecedents and may influence. however limited studies had conceptualized or explored how the conventional constructs of customer brand relationship model describe brand love, (e.g. trust, commitment and identification). since love is basically a interpersonal construct, thus it should be, logically, linked to other interpersonal constructs. thus, will explore what’s the position of brand love in a nomological context and how it can be described by other consumer brand-relationship (cbr) constructs (noel albert 2017). the purpose of this research is to build loyalty models that underlines symbolic factors like experience for value creation, rather than, only centering on the functional factors as a strategy. therefore, this study theorizes, with the prime objective to understand behavior in love, it’s essential to study the categories of experience that substances to the loyal customers dimensions. south asian review of business and administrative studies vol. 2, no. 1, june 2020 55 current research attempts to bridge the gap between practical issues and literature by exploring the relationship between brand experience and various elements of brand loyalty. more specifically, this research seeks to explain (1) how much sensory experience influences the dimensions of brand loyalty of consumers. (2) how much personal interaction impacts consumer mark loyalty dimensions. (3) how much affective behavior distresses customer label loyalty dimensions. (4) how consumer brand loyalty aspects are influenced by academic experience. this theory proposed that for a business to gain higher returns and sustainable performance by customer loyalty, superior value creation is crucial. hogarth (1996) recommended too avoid complex brand equity theories for research in smes. therefore, this theory is considered to be suitable considering that the results are found from the perception of customers in airline industry so, the study explore the connections between airline innovative brand experiences (ibe), brand love (bl), willingness to pay premium price (wttp), and brand loyalty. current study discus the mediating role of brand love between a) ibe and wtpp, b) ibe and brand loyalty. the plan for this article is as follows. after the introduction, we provided a theoretical basis on which to develop research hypotheses and conceptual models. next, we discuss methodological methods and propose empirical analysis. this article concludes with a discussion, implication, limitations and suggestions. literature review innovative brand experience: the brand experience is the sum of customer experiences to a brand (brakus 2009) brand experience is, the behavioral responses, emotions, perceptions and sensations that trigger brand-related stimuli and are a component of brand design and personality, bundling, communication, and condition. such stimuli mean that subjective brand experience, and furthermore brings out inside customer reactions and behavioral reactions (şahin 2011). in the earlier, invention has just focus on technology, but in the service industries and airline, there are now more and more product and service developments.airlines are currently provided that more and more designs for service procedures, service items (menus, meals and supplies), and passenger cabins. such innovative brand experiences are of immense significance for the contras (ha & perks, 2005). when consumers are exposed to different types of brand related stimuli, they continue to convert the brand into innovative longterm memory brand experience, which affects the satisfaction of t he product when purchasing on the basis of that memory (brakus et al., 2009). brand love is of social psychology origin.madden and shimp (1988), claim the first research by smearing a triangular theory of love by sternberg (1986) offers her first empirical study. in brq, fournier (1998) also indicates that love is a core element. in marketing papers, however, research on brand love is rarely published (albert et al., 2008; ahuvia, 2005; batra et al., 2012), and the term still needs its widely accepted description and measurement. alternatively, brand love is characterized as affection element, different from satisfaction, partiality and trust. the study of brand loyalty should consider not only perceived behaviors but also customer rationales or attitudes toward such behaviors (basu and dick, 1994; odin et al., 2001). this analysis thus fills the gap in preceding studies by modeling both behavioral and attitudinal brand loyalty dimensions (jones and taylor, 2007; chaudhuri and holbrook, 2001). in this research, we describe behavioral loyalty as the continuous purchasing of a brand by consumers, along with their repeated intention to buy in the upcoming (chaudhuri and holbrook, 2001). whereas, attitudinal loyalty refers to the degree of commitment of consumers and their attitude towards the brand on the road, and thus has an emotional component (chaudhuri and holbrook, 2001). south asian review of business and administrative studies vol. 2, no. 1, june 2020 56 willingness to pay premium price the willingness to pay premiums refers to “compared to similar/smaller products sold in the same quantity, quantity bundle, consumers want to pay higher prices for their favorite brands” (netemeyer et al., 2004). the willingness to pay a premium is closely related to product quality, because customers tend to pay higher prices when considering products with higher quality than expected (kim, 2014). therefore, the desire to pay a premium can also be seen as a proof of high perceived value, because it is triggered by a good evaluation of customers (keller, 1993; aaker, 1991). in other words, when a label increases its perceived value, customers are willing to pay a premium (oberholtzer, dimitri, and greene 2005). innovative brand experience and brand love brands are used to give the experience to others (batra 2012), the innovative expressiveness of a brand is described as an antecedent of brand love (huberet al., 2015). customers pick brands they trust people from their reference or longing cluster in a particular field would pick. along these lines, purchasers check their psychological self-picture by band together with a prototypical brand customer, subsequently isolating themselves from customers of various brands. on this commence, we wish to certify the valuable result of self-expressiveness on brand love and thusly suggest the going with; h1. brand love and innovative brand experience are positively related. brand love and brand loyalty brand love is made up of many different kinds of emotions. for example positive attitude, excite ment, and assessment, bias, attachment, commitment, etc. (batra et al., 2012; albert et al., 2008). it thus increases one emotional component. when customers love the brand, they have more loyalty to the brand, desire to use it, ability to contribute more money to purchasing the brand. behavioral loyalty, to be more comprehensive, and to promote positive word-of-mouth (wom) (batra et al., 2012; carroll and ahuvia, 2006). interrelated research also demonstrates the significant impact of such emotional elements on brand loyaly, e. g. attachment (johnson et al., 2006; fuchs et al., 2015). so, this study spreads the effect of these brand love components on brand loyalty, and so hypothesizes that: h2: brand love has significant impact on brand loyalty. brand love and willingness to pay premium price as per (foster & cadogan), for the typical buyer the price is supposed to be the most important. consumers with deep brand love will pay a premium price for their most loved brand, so their purchasing preferences won't be affected significantly by price. furthermore, consumers have a strong confidence in the price and estimate of their most loved brands, to the extent that they contrast and evaluate prices and elective brands (keller 2003). the happiness of consumers can also be found out by comparing values and the costs and benefits shown. should the item's apparent predictions be more noteworthy than cost, customers will be watched to purchase the item. customers who value the brand will pay a premium regardless of whether the price has changed due to the fact that the obvious threat is high and they like to pay a higher price to prevent the danger of any change (yoon and kim, 2000). so we can state that: “brand love will have significant effect on customer’s willingness to pay a price premium”. behavioral experience innovative brand experience brand loyalty south asian review of business and administrative studies vol. 2, no. 1, june 2020 57 figure 1: model of the study research methodology method setting and participants this research was done using various stages. a survey instrument has been adopted and conducted among pia and other international airline brand working in pakistan. we took different measures to select our respondents. first of all we took permissions from airport staffs for data collection through a request letter to terminal manager of each airport lahore, multan, islamabad, and karachi. after that we star our procedure for data collection. a survey based investigation of adult travelers was led to test the purposed reasonable structure. the researcher at first distinguished various respondents, i.e., respondents, who met the rule of availing air travel involvement at once. in pakistan add up to development of air ship was 158,101 included domestic and international flights and add up to 21,782,083 passengers traveled (caa 2016-17). those respondents who voyaged more than once revealed just on the latest flight involvement. this study uses the stratified sampling technique. in total, data 505 samples will be taken out from lahore, islamabad, karachi and multan. in most form of research it would be an ideal case if all of the population could be tested but then again it would be an impossible task to do because the whole population is too vast. this is the reason why most researchers rely on convenience sampling technique, hence in this study we use stratified sampling technique. in this research survey method was used to collect primary data. survey techniques are efficient and data can be collected at relatively low cost (chek & schutt, 2011). apart from its cost effectiveness, the survey technique makes it fairly possible for the research study to gather enormous amount of data as well. data was collected through a self-administrated questionnaire of 5-point likert scale. the survey includes a total of 80 items in which 11 were about demographics of respondent and 69 were about variables dimensions of conceptual framework. participants of the study were airline travellers. the data collected under the time period starting from march 2018 to april 2018. airline travelers were required to answer the questionnaire on the spot in lounge. here each of them was contacted personally on their visit to airport lounge while sitting after boarding. the respondents were clearly introduced and familiarized by the research topic and the purpose of the study, and were asked for their consent in order to record responses. the data was collected into different strata’s as morning, afternoon and evening flights. in day most of the flights were domestic and in afternoon and evening more flights were international. in this study there are more respondents are international travelers because the services and quality offer to international travelers is different. total 600 questionnaires were delivered each city 150 questionnaires, from which usable responses were 120 from lahore, 125 from multan, 125 from karachi, and 135 from islamabad, i.e. 505 usable respondents. the present study includes 34 items totals to ask in which innovative brand intellectual experience affective experience sensory experience innovative brand experience brand love willingness to pay premium price south asian review of business and administrative studies vol. 2, no. 1, june 2020 58 experience is asked by 12 items and each dimension have 3 items, brand loyalty by 9 items, , brand love by 10 items, and willingness to pay premium price by 3 items. overall data screening process out of 505 respondents no missing value and aberrant value detected due to consciously and actively data collection process. characteristics of respondents like gender, age, education purpose of travelling are included in table 1.1. characteristics pia n = 230 other airlines n = 275 overall n = 505 frequency %age f % f % f % gender male 136 59.1 175 63.6 311 61.6 female 94 40.9 100 36.4 194 38.4 age ≤ 20 21 9.1 28 10.2 49 9.7 21-30 67 29.1 75 27.3 142 28.1 31-40 55 23.9 66 24.0 121 24.0 41-50 36 15.7 47 17.1 83 16.4 51≥ 51 22.2 59 21.5 110 21.8 occupation student 20 8.7 26 9.5 46 9.1 job holder 139 60.4 162 58.9 301 59.6 businessman 64 27.8 80 29.1 144 28.5 other 7 3.0 7 2.5 14 2.8 purpose of travelling business trip 35 15.2 44 16.0 79 15.6 visit family 65 28.3 80 29.1 145 28.7 holiday enjoy 87 37.8 97 35.3 184 36.4 special occasion 40 17.4 50 18.2 90 17.8 other 3 1.3 4 1.5 7 1.4 (cfa)confirmatory factor analysis, was used to measure the measurement model in our study. later, (efa)exploratory factor analysis, via principal component method. with varimax rotation was first manage. so that we refine and screen the data, previously sem was take on for together data set, (pia & other airlines) with 69 items (field2009). for measuring the factor relationship efa used between factors and at that point permits multivariate techniques to be used. so that we can evaluate the relationships (hair et al.2010). in order to determine the number of items to be retained, own values exceeding 1 were obtained, as suggested by field (2009). a multi-group confirmatory factor analysis (mcfa) with amos was used to check the variations between pia and other airlines. hair et al. (2010) proposed that the metric should be identical across groups so that analysis can investigate whether the response characteristics for each object are equally constructed across groups. the first step in the mcfa, therefore, was comparison to evaluate a baseline model (configural invariance). configural invariance refers to the equality of the factor structures between classes for the theoretical model. according to this stage, data were combined for the public and private heis in iraq to create a baseline model and then the discrepancies in the hypothesized relationships in the theoretical model were confirmed using mcfa. the measuring model, (configural invariance) was tested using the fitness of fit indices as shown in table 2. there are three simple indices: (a) the fit indices, the counting of{ 2,}2/df, the goodness off it index (gfi) and the root mean square approximation error (rmsea); (b) the incremental fit index (nfi) and the comparative fit index (cfi); and (c) the parsimonious normed fit index (pnfi) measure. south asian review of business and administrative studies vol. 2, no. 1, june 2020 59 2 invariance measurement model construct χ² δχ² df δdf χ²/df gfi nfi cfi rmse a pia 591.4 2 ---473 --- 1.24 9 0.90 5 0.92 8 0.98 6 0.031 other airlines 596.5 5 5.13 2 505 32 1.17 8 0.90 2 0.92 7 0.98 7 0.041 the result shows model fitness and hence there is configural invariance between pia and other airline brands that shows the comparison study can be held. this research results are identical for fixed and non-fixed parameters and it support the pia and other airline brands. there are differences in the chi-square values and other parameters are in range. construct validity for comparative study we do the 2nd order cfa analysis for pia and other airline brands in which innovative brand experience into 4 sub dimensions which results shoes the internal reliability on brand love to create brand loyalty. behavioral effect of innovative brand experience has more influence on generating love and loyalty in this model. cfa & internal reliability table pia n=230 other brand n=275 construct code ave cr α ave cr α innovative brand experience ibe 0.72 0.92 0.71 0.76 0.91 0.87 brand love lov 0.69 0.88 0.75 0.74 0.90 0.88 brand loyalty bl 0.71 0.91 0.78 0.71 0.88 0.87 willingness to premium price wtpp 0.73 0.90 0.90 0.75 0.92 0.92 construct validity of pia lov ibe bl wtpp lov 0.78 ibe 0.35 0.76 bl 0.30 0.29 0.75 wtpp 0.24 0.21 0.19 0.72 construct validity of other airlines lov ibe bl wtpp lov 0.71 ibe 0.34 0.72 bl 0.33 0.32 0.7 wtpp 0.26 0.23 0.133 0.74 construct validity of all brands lov ibe bl wtpp lov 0.627 ibe 0.594 0.781 bl 0.197 0.294 0.75 wtpp 0.139 0.065 0.055 0.783 south asian review of business and administrative studies vol. 2, no. 1, june 2020 60 discriminant validity is a measure of inward continuity and refers to the degree to which a construct from separate technologies is truly unmistakable (hair et al.2010). in this study, discriminant validity was surveyed using the parameters established by fornell and larcker (1981). the ave should be more prominent than the square relation between two versions, as indicated by them. in this exploration, the builds were observationally particular, and the discriminant validity was factually affirmed in both pia and other carrier brands .table shows the methods and standard deviations. also, it demonstrates that the fluctuations extricated were more noteworthy than the greater part of the squared relationships between things. hypothesis comparison pia & other brand by the sem analysis in amos we test the hypothesis for pia and other airline brands. the results was not so much surprising for us as structural equation models of pia and other airline brands shows that effect of innovative brand experience on brand love is not supporting in pia’s model so the mediating role of brand love between brand loyalty and wtpp is also neglecting in pia case and all the hypothesis related to innovative brand experience are not supporting. the reason is pia in not giving new experiences and other complimentary services to their travelers as compare to other brands, people love pia due to its service quality and its branding as national brand. pia’s service quality is better and it is giving tough time to other brands in market to engage the customers as well as its prices are also low as compare to other brands. hypothesis testing for pia hypothesis direct effect of paths (γ) tvalue p-value decision h1 ibe🡪lov 0.150 0.540 0.589 rejected h2 lov🡪bl 0.002 0.032 0.974 rejected h3 lov🡪wtpp 0.386 3.165 *** accepted h4 ibe🡪lov🡪bl 0.203 0.048 0.774 no mediation h5 ibe🡪lov🡪wtpp 0.160 0.069 0.624 no mediation sem analysis also had done on other airline brands and all the paths shows the positive relations between the variables. direct effects of love on brand loyalty was more significant as compare to innovative brand experience and direst relations between brand love to wtpp and airqual to wtpp and airqual to brand love all were significant. the mediation paths for all other airline brands were partially mediated the effect of love between innovative brand experiences, airqual, brand loyalty and willingness to pay premium price. mediation role of brand love for innovative brand experience and brand loyalty was significant but low as compare to other 3 paths. hypothesis testing for other airline brands hypothesis direct effect of paths (γ) tvalue p-value decision h1 ibe🡪lov 0.455 3.162 0.002 accepted h2 lov🡪bl 0.432 3.495 *** accepted h3 lov🡪wtpp 0.464 3.959 *** accepted h4 ibe🡪lov🡪bl 0.411 2.118 0.003 p. mediation south asian review of business and administrative studies vol. 2, no. 1, june 2020 61 h5 ibe🡪lov🡪wtpp 0.440 3.733 *** p. mediation this shows that airline brands doing more activities to realize better brand experiences in customer mind to generate loyalty and love to gain the customer for life time. it is actually the recycling of brand and services by giving innovative experiences and creates loyalty. discussion the final section of the study acts as an ending as well as a beginning. from this very important various other questions and queries originate and several other prospective repercussions may be initiated. this section tends to illuminate and reflect other valuable ideas and open doors to new studies that may be a source of contribution to this field. this study adds to the comprehension of customer loyalty. this examination activity analyzed precisely what goes to make up traveler faithful and in addition how fulfilled customers were with the services gave the airline under thought. the flow investigate broadens the information of brand loyalty by building up a model which illuminates the connection between innovative brand experience, brand love, customer willingness to pay premium price and brand loyalty. this investigation was directed inside a pakistan and, accordingly, to the extent the creators know, gives one of the primary depictions of pakistani's airline travelers. this examination likewise does the correlation between airline service characteristics and innovative brand experience of pia with different airlines brands which are worked in pakistan. the result shows that in pia there is lack of innovations as compare to other airline brands which is defeating pia from other competitor because pia is not generation love from innovations and its credibility and loyalty is down from which customers are not satisfied and choose it as only national airline . overall the entire hypothesis is accepted but in pia case impact of innovations on brand love and loyalty was so bad. this research will help out the managers of pia and other airlines to improve their service as well as bring innovative brand experiences which will generate loyalty in customers mind and positive word of mouth will generate. generally speaking, the investigation distinguishes the contributing factors and in addition the results of airline travelers' affection with service, and infers that unrivaled innovative brand experience, and brand love prompt traveler brand loyalty, which will thus yield a further result, brand loyalty. limitations and future research notwithstanding its hypothetical commitments and the down to earth suggestions, this ebb and flow examine additionally has restrictions. the after effects of this investigation depend on stratified testing methods and after that utilized accommodation examining and the impression of the travelers of the all airline organizations in pakistan. this study did not classify the business class travelers and economy class travelers so their love & loyalty intentions may be compromised. so it is suggested that a study can be done only just business class travelers and then seek out their results on love and loyalty. brand image can be taken as moderator between mediators and dependent variables. moreover this data is collected from those travelers who are waiting for their flight in lounge; data can be taken from those passengers who had just arrived, that data will briefly indicate the airline service quality and innovative experiences of airlines which drive towards brand loyalty and their willingness to pay premium price. additional studies can be conducted with in pakistan about domestic airline brand and their comparison with pia domestically. cross sectional studies are used in this research; longitudinal studies can be conduct with time lag in which data can be collected by corporate sector’s travellers which travel frequently and from travel agencies which have loyal customers and they repeat purchase of airline tickets from same travel agency. passengers other than outsiders ought to be reviewed to give a progressively allencompassing image of administration quality at airline. extra examinations with different organizations in a similar industry ought to be led to build the chance to make correlations and gain further 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(2010). using the brand experience scale to profile consumers and predict consumer behaviour. journal of brand management, 17(7), 532-540 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 31 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas stress management among academics: an insight for federal polytechnic, bauchi nigeria isah shehu mohammed, federal polytechnic, bauchi – nigeria muhammad fuad bn othman, universiti utara, malaysia nazariah binti osman, universiti utara, malaysia article details abstract history revised format: may 2022 available online: june 2022 keywords academics, federal polytechnic, education, employers, management, organization, stress this paper explores stress and its management among academics with an insight for the federal polytechnic, bauchi, nigeria. like many other higher public and private academic institutions, the polytechnic has over the years silently lost a substantial number of its staff to stress, while some others have become temporarily and or permanently incapacitated, particularly the academics. this paper is a theoretical, secondary and qualitative study. the data were obtained from journals articles, conference papers and other public documents within and outside the polytechnic. the literature also explored various fields related to organizations, employees and employers, psychology and education and found that stress result in death, permanent and temporary incapacitation of many academics some of which could be avoided by reduction and proper management of stress among the academics. the study made some specific in addition to the general recommendations in order to reduce and effectively manage stress among academics of the institution, including standardization the school medical centre and its services, consistent and sustained medical checkup on all polytechnic employees, job redesigning, enforced proceeding on annual leave, an extra-ordinary means productivity award, extensive and intensive enlightenment and education on stress. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mishehu@fptb.edu.ng doi: https://doi.org/10.52461/sabas.v4i1.1008 introduction one of the age-long and major challenges confronting both employers and employees in most institutions/organizations all over the world, particularly the academic institutions and whether public or private, is the work/life balance, which among others, causes stress. work-related stress is increasing in prevalence, with significant and negative consequences for employees, employers, output/productivity, the economy, and society as a whole (cullinan et al., 2019). stress evolves largely from multi-tasking, role overload, coping up with contradictory demands, and the need to balance priorities. what constitutes or results in stress in one individual, circumstance, https://journals.iub.edu.pk/index.php/sabas mailto:mishehu@fptb.edu.ng https://doi.org/10.52461/sabas.v4i1 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 32 environment or organization may not to another. similarly, stress is a personal experience to which all individuals respond, but relatively. there is no agreement on whether stress is in itself a disease or not. however, it is indisputable that when stress accumulates, it results in many and multidimensioned diseases which is why greater attention of organizational behavioralists, psychologists, employers, employees, and socio-psycho-medical and health experts. that also prompts its study and review with much concern, especially that it is universal and relative to different organizations/institutions, individuals and circumstances. the federal polytechnic, bauchi is one of the famous higher educational institutions in nigeria. it is like the others, faced with the challenge of stress and to how to manage it among its academics, being the population of this study background of the federal polytechnic, bauchi nigeria the federal polytechnic, bauchi was established alongside six others on 25 july 1979 via decree no. 33 of the then federal military regime of general olusegun obasanjo. that decree was later amended with decree no. 5 of 1 january 1993 by the regime of general ibrahim babangida. the polytechnic is located in gwallameji village off dass road, in the capital city of bauchi, bauchi state. according the establishment decree, the main functions of the polytechnic include: provision of both part and full time courses and training in management, applied sciences and technology as well as other fields for nigeria’s socio-economic, agricultural, industrial, research and technological development; arrange conferences and seminars on the various fields above; and carry out any other functions in promotion of the objectives for the establishment of the polytechnic. the polytechnic has a governing council established via the same decree no. 33. the council is a corporate body and comprises of a chairman and other members appointed by the federal executive council. the polytechnic has six schools and each is of the schools is headed by dean science and technology, general studies, engineering technology, business studies, environmental technology and agricultural engineering technology. under these deans are thirty four academic departments which are each also headed by a head of department. apart from the six deans, there is also the dean, students affairs heading the students affairs. in all the departments, causes are taught at levels of diploma, national diploma (nd), higher national diploma (hnd), post-graduate diploma and other affiliated degree programmes which are specifically handled by the directorate of university affiliations and linkages (dual). the polytechnic also has directorates of entrepreneurship development, research development, siwes, procurement, audit, academic planning, works, special duties, intellectual property protection and transfer office (ippto), and the medical centre. there are also the public relations and physical planning units. the rector is the chief executive officer of the institution. he is appointed for a single tenure of five years and assisted by a deputy rector. there is also the office the registrar for the polytechnic and several deputies registrar (establishment, academics, servicom/noddal, students affairs, staff development and training, public relations, guidance and counselling, exams and record, and admissions). materials and methods this study is theoretical and used secondary sources of available literature to collect the data used in the study. the secondary materials include books, journal articles and other public documents (creswell, 2012). the materials were also drawn from many areas and fields with stake in academia, other organizations, stress and employer/employee relations – psychology, education, organizational behavior, financial experts and institutions, among others. it is also a qualitative/non-numerical in design (leavy, 2017). this design enables researchers to freely south asian review of business and administrative studies vol. 4, no. 1, jun 2022 33 discuss problems at hand and provide open answers to such (saris & gallhofer, 2007). qualitative research also enables the researcher to fully explore, investigate and focus on problem, relate it with others and deconstruction of collected data in order to make the audience have a deeper and clear understanding of the research problem and the results obtained (bernard, 2006). conceptualization and review of related literature stress is universal and relative, and is therefore, seen and defined relatively. many therefore, see and or define stress from varying perspectives of understanding, environment, and circumstances. stein and flexner (1984) define stress as a tension and an anxiety. health and safety executive (2001) defines stress as an individual's damaging response to excessive pressure and demands placed upon him or her. some individuals appreciate and perform better under pressure (low stress), whilst others may underperform and incur health problems as a result of stress. schuler (1979) describes stress as "a dynamic circumstance in which an individual is confronted with an opportunity, limitation, or demand connected to what he or she wants and for which the perceived consequence is both unclear and significant." according to moorhead and griffin (2004), stress is a person's response to a stimulus/stressor that places him or her under excessive physical or mental pressure. thus, according to selye (1978), stress is an exogenous or inner desire to alter the life balance. occupational stress is defined as "the detrimental physical and emotional responses that arise when the demands of the job do not match the worker's capabilities, resources, or needs" (de silva et al., 2017). as a result, stress is characterized by the experience of negative emotions, such as anger, tension, worry, frustration, and despair, as a result of occupational circumstances (kyriacou & sutcliffe, 1977). the definition of stress in the simplest terms is a frequent response to attack triggered by the disruption of the body's natural homeostasis (haque & aston, 2016; haque et al., 2018). stress in the academia studies have established significant linkages between stress and job satisfaction at tertiary education levels (haque et al., 2019; chaudhry, 2012). all over the world, including nigeria, higher education institutions today face multidimensional changes and demands, which are not only challenging their conventional ways of operating, but also affect their mandates, authority, and organizational structures, and output and its quality (doyle & hind, 1998). unlike in the past, higher educational institutions no longer enjoy stress-free working conditions and environment as both academic and non-academic staff are increasingly tied by the job, more job demands and increasingly challenging productivity from them with much pressure on their time, energy and commitment. these result in many negative effects, including stress and other poor sociopsychological, socio-physical, medical and health conditions, with the increasing rate at which employees collapse and or die suddenly (sudden death) or develop diseases (mccormick & barnett, 2011). while these happen, employers increasingly demand more commitment and productivity from their employees in order to achieve optimum commitment and productivity and quality assurance (haque & oino, 2019; wolniak, 2019). however, employees’ commitment to organisations and their goals is largely affected by ‘occupational stress’ (haque et al., 2019). the education sector, particularly the tertiary institutions with the polytechnics among others, is required to undertake greater challenges in fulfilling the global demands and expectations of the twenty-first century in intellectual research, technical and vocational innovations, which are indispensable to the increasing academic, markets and industry demands, and states competition for knowledge, resources and development as well as the sustenance of same by both governments and other non-state actors/non-governmental organisations in both the short and long runs (johari et al., 2018). the teacher, being the ‘backbone’ of every society that aims at building a healthy an south asian review of business and administrative studies vol. 4, no. 1, jun 2022 34 prosperous state and society has the great responsibility of not only imparting knowledge, but also noble and essential characters and values, particularly at the higher institutions for the purpose of producing resourceful, positive and industrious state and society. teachers are, therefore, bestowed with the responsibility of not only designing, but also improving and or modifying a nation with proper future direction (chaudhry, 2012; ahmad, 2006). however, the teachers as well as the others working with them are increasingly engaged in more complex teaching, trainings, practicals, assessments and researches as well as administrative activities which altogether increase tension in the job and result in stress with consequent effects which are often negative (child, 2004). this ‘stress’ negatively affects ‘competence’ and ‘productivity’ as well as the overall life of the teachers as shown by several researches for nearly four decades, especially where the working conditions are poor (watts & robertson, 2011). causes of stress many employees across academia, other institutions organizations (public and private) suffer stress and the quality of employees’ output/productivity is largely determined by absence of, high and or a low level of stress (george & zakkariya, 2015; mullins, 2007). while stress is relative to bio-environmental, working conditions, socio-psychological and geo-physical factors among others, it is universal. therefore, the universal major causes of stress in organizations include: ✓ increased competition/demand for increased productivity at low or poor operating costs ✓ age of employee ✓ excessive work load and increased/extended working hours for the employees ✓ excessive and harsh rules and regulations, excessive bureaucratic red-tapism ✓ poor communication, poor social and inter-personal relations, campus/office politics/academic and non-academic staff rivalry ✓ lack of autonomy, poor delegation of power and responsibilities ✓ poor or unclear division of responsibilities ✓ poor communication and lack or absence of consultation ✓ blame game ✓ scapegoating ✓ denial of impending problems ✓ take home work both problems or issues may be the reasons behind employees stress in organization (haque et al., 2019). on another hand, a study by kouvonen et al. (2008) shows that high rate of job stress is linked to higher intensity of smoking, just as hassard et al. (2018) note that higher rates of alcohol consumption are linked to more stress-intensive roles. stress is also largely associated with and related to long working hours, high levels of emotional demands, time pressure, bullying, harassment, violence, and discrimination in workplaces (cullinan et al., 2019; kivimaki et al., 2015; russell et al., 2018). this submission is particularly emphatic to the population of this study. the population is characterized by longer working hours (excess work load), time pressure to meet up with lectures, marking of tests, assignments and examination scripts, conduct and assessment of practical, project supervision, conducting researches, development of conference papers and journals publications, among others. others also have additional responsibilities of administrative duties such as deanship, headship of departments and units. effects of stress on academics/employees and organizations/institutions a study by russell et al. (2018) shows that the proportion of employees experiencing job stress increases and has specifically more than doubled from 8% in 2010 to 17% in 2015. public sector employees, including academics/teachers undergo higher rates of work-related stress than normal and that is usually accompanied by attending negative impacts on their physical health (kawano, 2008; quine, 2001; einarsen et al., 1998). factors resulting in stress are varied – the environment south asian review of business and administrative studies vol. 4, no. 1, jun 2022 35 and environmental factors, behaviors, among others and different types of psychological, behavioral and psychological difficulties are experienced by employees as a result of stress (haque et al. 2018). stress is arguably not a disease, but rather, the adverse reaction from individuals as a result of excessive pressure. it can however, accumulate and result in nervous breakdown, depression, heart related diseases, total collapse and sudden death. stress adversely affects the employee’s productivity and entire work life, family relations and bond. it has a significant influence and impact on physical, mental, social and environmental well-being. stress results in not only tension, poor/low productivity (poor judgment, fatigue, bad/poor decisions), but also frustration, confusion, and unethical acts. for this, stress that happens at workplace (professional stress) and factors related to it are the behavior of boss, co-worker, attitude and the organization’s environment (nayak, 2008). similarly, factors such as workload, emotional pressure, lack of support, and role ambiguity may cause fatigue and create negative attitudes towards one’s job (bakker et al., 2005). unrelieved stress may result to diseases, accidents, damaged relationship between employers and employees and among the employees, early retirement based on medical grounds, high rate of sick and casual leave, premature death, higher turnover of employees, and inefficient/ineffective services delivery. consequences of occupational stress are observed at two levels, at the organization where the employee works, and at the level of the employee himself. there is a significant relationship between the levels of the institution/organization and the academic/employee and each significantly affects the other. whether an institution/organization achieves its missions and attains its goals or not has significant effects on its employees (mosadeghrad, 2014). according to block (1977), stress destroys personal life activities and life imbalance may result in death, divorce or accident, especially where personal and other stresses such as professional, health conditions and problems increase or compound. research on the harmful effects of occupational stress in relation to the employees’ physical well-being also indicate that there occur more and at higher, level risks of cardiovascular and respiratory diseases, musculoskeletal and psychological disorders, psychological disorders and sleep disturbances, lack of concentration, depression, intolerance and anxiety, among others with occupational stress (o’connor et al., 2000; kang et al., 2005). o'connor et al. (2000) and o'kane et al. (2000) conducted research on the negative effects of occupational stress on a worker's physical well-being and health, and found that among the most significant consequences are increased risks for cardiovascular diseases, musculoskeletal disorders, respiratory diseases, psychological disorders, sleep disturbances, lack of concentration, depression, intolerance, and many others, as well as anxiety. managing and coping with stress among academics stressors vary from one institution/organization to another – factories, assembly plants, public/private organizations, the academia, health sector, among others. it is thus very important to identify which stressors are common and or peculiar to an organization before it can be properly manage and or reduced. there are three universally identified strategies for coping with stress as: problem solving, seeking social support, and avoidance (amirkhan, 1990). however, stress for federal polytechnic, bauchi can be also be generally reduced/managed through: ✓ job clarity ✓ design of stress management standards which may be unique for institution/organizations and age grades ✓ provision of counselling and support services for academics/employees ✓ educating the employees on stress, its impact and ways of management/reduction in worklife balance south asian review of business and administrative studies vol. 4, no. 1, jun 2022 36 ✓ effective communication between employers and the employees, and among the employees ✓ provision of timely and meaningful support (which may relative to individuals and institutions/organization) to employees ✓ engaging in friendly management style ✓ discouragement of excessive work and or working for long hours ✓ avoidance of harassments, discriminatory policies and programmes or preferential treatments among employees ✓ phasing out all unnecessary works and prioritization of such works ✓ ensure matching academics responsibilities and schedules with qualifications, experience and determination ✓ where possible, schedules should be made flexible ✓ engaging in kabat-zinn’s popular mindfulness-based stress reduction (mbsr) training which comprise of: body scan (paying attention to what the body is feeling); sitting meditation (paying attention to breathing, sounds, thoughts, bodily sensations, feelings/ emotions); simple movement exercises such as walking or standing meditation, or lying yoga exercises (paying attention to what the body is feeling; exploring and accepting borders); informal meditation exercises such as paying full attention to daily activities (brushing one's teeth, taking a shower, eating, among others) (kabat-zinn, 1996; kabatzinn et al., 1992; kabat-zinn, 1990). workload and stress in the academia the relationship between stress and workload has also gained scholarly and professional attention. it refers to any actions directly or indirectly affecting employees' time spent executing professional obligations, responsibilities, and interests at work (johari et al., 2018). shukri (1998) defines workload as the responsibilities given to teachers in or out of the classroom, whereas azita (2012) defines workload as the amount of time spent by teachers performing various tasks related to their official duties as a teacher, such as teaching and learning, co-curricular activities, meetings, etc., during or after school hours. it is thus viewed as the amount of time required by instructors to complete their official responsibilities during or outside of school hours. in order to be more efficient and productive in their job, academics must not only spend time in the classroom, but also spend additional hours after work (sharifah et al., 2014; punia & kamboj, 2013). in the same manner as increased academic workload, the ratio of teachers to students increases (easthope & easthope, 2000). hassam et al. (2011) report that lengthy working hours due to excessive workload may have a negative effect on job satisfaction as this circumstance interferes with an individual's health at work and at home, including the risk of coronary heart disease and stroke (kivimaki et al., 2015). work-life balance, workplace changes and stress in academia work-life balance entails "striving for a balance between job and life and feeling at ease with both work and other family obligations" (daipuria & kakar, 2013). consequently, work-life balance, which abendroth and dulk (2011) also view as the harmonious interface between the various domains of life, is vital to the quality of work, workload carriage, socio-psychological well-being of the academic staff, as well as the quality of students produced and their overall contribution/impact on society. the pressure on employees in most organizations has increased as a result of demographic and workplace changes such as an increase in the proportion of women in the workforce, an ageing population, a shortage of skilled workers, an escalating degree of globalization, and intensifying market and labor competition (beauregard & henry, 2009). these consistently lead to a rise in a variety of other factors, such as mental and psychological health issues associated with stress or south asian review of business and administrative studies vol. 4, no. 1, jun 2022 37 depression, and increased absenteeism (american psychological association, 2015; delongis, et al., 1988; richardson & rothstein, 2008; halpern, 2005). according to hertel et al. (2013), ageing refers to changes that occur in biological, psychological, and social functioning through time, consequently influencing individuals on the individual, organizational, and societal levels. in this environment, elder employees are less stressed than their younger counterparts. on the other hand, it is emphasized that the impact of stressful employment varies with time or life stage. as a result, older employees or individuals may be more susceptible to occupational stress, as the ageing process is accompanied by changes in coping capacities and resources, as well as physiological system changes. therefore, older employees may be more susceptible to being ill as a result of stressful work and may require a longer duration to recover from illness. in this instance, the link between stress and sick leave would be stronger among and for older employees (gotz et al., 2018). similarly, employees who are unable to cope with stressful events and conditions may experience unfavorable socio-physical, socio-psychological, and/or behavioral impacts. physical, employees experience head, neck and shoulder pains, as well as or ‘elevated heart rate’. psychologically, employees negatively experience include insomnia, anxiety, depression among others. behaviorally, there are fatigue, less effectiveness and efficiency, among others. these, altogether, negatively influence the entire performance/productivity, output of an organization (hespanhol, 2004). conclusion and summary stress management is a key factor to physical, mental and social well-being of academics in any institution, including the federal polytechnic, bauchi. inability or poor management of stress negatively affects both individuals and institutions. stress is a personal experience among the academics, including those of the federal polytechnic, bauchi, and varies with personality. it is also determined by nature of the job of the academics, and commensurate with the type of organization (public and educational). each individual academic has his/her particular response to it and ability to cope with or manage it (mullins, 2007). not all stress, particularly an amount of it that is not much can be said to be negative or bad on the academics of the polytechnic. stress may, among others, be good in increasing performance and productivity of the academics. while pressure to work may improve performance, achieve proper harnessing of opportunities and positive response to challenges, stress is that continuous and extreme pressure or demands while the individual is unable to cope with such. causes of stress among academics can be personal, social among others, and it is hard to completely do away with stress. its proper management among polytechnic academics is however, imperative upon the employer (polytechnic) and the employees (academics) in order to achieve the organizational goals and at the same time ensure safety, good health and socio-psychological and environmental well-being of the employees. stress has been a major concern to all academics, whether public or private institutions. in the public sector, higher educational institutions are among those on top in the list of those with higher levels of cases of and risks associated with stress. such institutions have over the years lose a substantial number of workforce which causes adverse effects on the output and quality of services they deliver, and impacted negatively on the other employees, their work-life balance – social relations, families and friends, leisure, economic well-being and life-span among others. the federal polytechnic, bauchi is one of the best and leading federal polytechnics in nigeria largely due to management’s determination to deliver the best and qualitative services to the public in addition to other unique services it renders such as full audit of each and every semester results and scripts. hence, because of the nature of the services delivered and the determination to deliver the best and excel, many academics of the federal polytechnic, bauchi – nigeria, have over the years suddenly collapsed, died or lost the control of their medical and health status and situations. these have been the results of among others work pressure, failure to balance work-life, much south asian review of business and administrative studies vol. 4, no. 1, jun 2022 38 commitment to work without balanced rest, efforts to meet up with deadlines, among others which are altogether tied to stress. while this occurs, many of the experienced employees such as chief lecturers, technologists are not only ageing, but retiring thereby leaving a gap which can hardly be filled. in spite of the extended retirement age of 65 to the academics, shortage of experienced lecturers and technologists, for example, threaten the attainment of the institution’s main objectives. many of the retired also face varying types and degrees of medical and health challenges largely due to excessive loads they had carried earlier in the course of their working career. although it would be hard to away with stress, the management of the federal polytechnic, bauchi can do a lot to reduce and or manage the extent to which stress negatively affects its employees, particularly the academics. it may not also be done within a short period of time, but careful and meticulous implementation of both general and some other specific recommendations based on the universality of stress and the peculiarities of federal polytechnic, bauchi can go a long way in proper management or reduction of stress among its employees. this will in the end, optimize not only productivity, but the quality of academic and other services discharged by the polytechnic. recommendations from this study, it is pertinent that unnecessary and or excessive stress cause major harm to the body and healthcare, socio-psychological, family and distant relations of employees. it also harms the organization, environment and many other related systems. in view of the practical and negative effects of stress on employees, particularly the academics of the federal polytechnic, bauchi, this study recommends to the polytechnic management and the employees that: the polytechnic medical centre should be standardised with modern, sophisticated and adequate medical and health facilities, equipment and consultation services for optimal, effective and efficient healthcare services delivery; sports equipment and other recreational facilities should be provided or rehabilitated in the polytechnic; there should be extensive and intensive enlightenment and educational programmes to all the polytechnic employees on stress, its effects and management and general healthcare; annual leave and the rights of every employee to go for it and the socio-psychological and medical importance of undertaking the annual leave; there should be comprehensive and rotating policy on annual leave so that all employees can be allowed to go such leave within the year no matter their schedules; the establishment unit should devise appropriate means and modalities of deploying and redeployment of staff to the relevant departments and units for effective service delivery and sound healthcare/working conditions; employees, especially the academics should only be allowed to handle tasks they are competent to and be given relatively balanced time and tasks schedules, including load/rank ratio; excess workload should where possible be avoided and where imperative, it should be shaded such that some employees will not be overloaded over others; establishment unit should identify departments/units with more employees but less work with a view to redeploying them to other departments/units in need of more human resource/manpower; students should be made to comply with all laid down rules and regulations governing admission, lectures, examination so as to reduce the extent to which problems arise as a result of non-compliance with established rules; academic calendar should be made to reflect the realities of nigerian situation, rather than always banking on an ideal situations; heads of departments and units should always have good and warm relations with their subordinates and other colleagues so as to be fully aware of their conditions (socio-psychological, economic, medical and health, among others), and to take appropriate actions and measures where and when necessary; management should encourage the establishment of varying welfare schemes, cooperative societies and services which cover and render extra and supportive financial services, facilities on housing, transportation, essential commodities, access to medical and health services, among others; flow of information on job specifications, extant rules, conditions of service, requirements for promotion, issues of discipline south asian review of business and administrative studies vol. 4, no. 1, jun 2022 39 should also be made simple and clearly spelt 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(2019). operation manager and its role in the enterprise, production engineering archives, 24(24), 1-4. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 1 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas what is the role of transformational leadership in smes? a review paper shaista jabeen, university of pec’s, hungary article details abstract history revised format: may 2022 available online: june 2022 keywords transformational leadership; smes; leadership style purpose: the aim of this research paper is to investigates the role of “tl (transformational leadership)” in smes (small and medium enterprises). methodology: the methodology adopted is this study is systematic literature review. total 58 articles have been shortlisted out of 201 downloaded articles based on quality and relatability with topic and reviewed in order to reach conclusion. articles publish in last 12 years in high-ranked scimago journals (srj) are downloaded. findings: this study provides a cross cultural view. this systematic review reveals that among all the advanced leadership styles, transformational leadership style is most influential in terms of survival, performance, organizational learning and innovation. among the four components of transformational leadership, intellectual stimulation is highly associated with firm performance. limitations of research /future recommendations: the scope of this study is limited to just smes, and it will be interesting if future research analyze the impact of transformational leadership on public and private companies and corporations. theoretical/ practical implication: this study added a synthesized view of “the role of transformational leadership in the smes” in the existing literature. this study provides a guide to the leader of smes regarding implications of transformational leadership in smes and suggest leaders to adopt transformational leadership in order to become an innovative firm and increase performance. originality/value: a comprehensive systematic review of the literature on the impact of transformational leadership on smes has been done in this study. this study stated the outcomes of tl in smes in different countries which increase generalizability. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: shaistajabeen553@gmail.com doi: https://doi.org/10.52461/sabas.v4i1.1021 introduction and importance of smes smes are defined differently based on the sectors, manufacturing enterprises with business turnover not more than rm50 (almost usd12.4m) million or full-time workers not surpassing 200. other than manufacturing sector i.e., in service sector smes are characterized as organizations with revenue turnover not more than rm20 (almost usd5 m) million or full-time https://journals.iub.edu.pk/index.php/sabas mailto:shaistajabeen553@gmail.com https://doi.org/10.52461/sabas.v4i1.1021 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 2 workers not surpassing 75. ninety to ninety five percent of total organizations are smes in most of the economies ((sheshi and kërçini, 2017; katua, 2014). smes are exporter of 1/3 of total exports from asia (channel news asia). most of the largescale organizations like microsoft and apple initially started as an sme and later developed into a corporate giant (ng and kee, 2018). smes assist significantly in economic development of both developed and under-developed countries. in under-developed countries, smes make contributions in accomplishment of sustainable developmental goals (sdgs), by creating job opportunities for unemployed workforce, fostering sustainable industrialization, promoting innovation and shrinking income imbalance. smes are a source of employment for multiple segments of society, in different geographical regions and across various sectors i.e., un-skilled labor force, belonging to the rural area and thus offer opportunities for skill improvements (syed et al., 2012; sheshi and kërçini, 2017; nanjundeswaraswamya and swamyb, 2015). smes represent a large portion of total firms and make remarkable contribution to gdp growth rate (ng and kee, 2018). most of the underdeveloped countries priorities entrepreneurship and smes to deal with their economic and social problems. they are enthusiastically pushing smes to develop in a huge manner to drive their economies from mediocrity to fully developed (ng and kee, 2017; (manzoor et al., 2019). regardless of being focal point of consideration by the governments with great deal of support, smes have not accomplished the ideal level of success. during the early stages, smes fight with the threat of failure, getting through downturn flourish in a climate portrayed by unpredictability and market uncertainty (hotho and champion, 2011). according to the manufacturing association of nigeria (man) approximately 10% of ventures run by entrepreneurs are fully in operation. most of the smes die within their starting first to five operating years (abiodun and mahmood, 2015). while some of them vanish within six to ten years of their startup and the survivors that grow to the stage of maturity are not more than 5% to 10% (sme corporation malaysia, 2016). insufficient management and leadership skills are the most basic factors that lead smes towards failure. leadership styles and behaviors has an extraordinary impact to on the success of an entrepreneur’s venture (paladan, 2015). quickgrowth smes exhibit capacity to take benefit of opportunities linked with vulnerable market, financial and environmental conditions. however quick-growth firms may grow quickly, their success cannot be long-lived except if good organizational procedures and effective leadership is implemented to guarantee long-term profitability, sustainability and growth (haltiwanger, jarmin, and miranda, 2010). abdul razak (2010) suggested that growth of suitable leadership is one of the dynamic powers for the success of small and medium enterprises in coming years. success of entrepreneurial venture is influenced by leadership style (paladan, 2015). previous data inferred that poor management and leadership skills are primary factors contributing to sme’s failure. effective leadership is a crucial instrument to keep the motivation level of employees high, full capacity utilization of limited resources and the influence of that individual, regarded as the leader, is of significant level that can impact the economic and social factors specifically and to whole society as well and positively affect the workers behavior in order to achieve company goals (khan et al., 2013). hayat and riaz (2011) argued that transactional and transformational leadership skills and behaviors are associated with smes as they are straightforwardly related to the sme's operational techniques and external environment in which entrepreneurs handle their business activities. these leadership styles are also recommended by other researchers, who suggested that these leadership practices are more appropriate to the setting of sme’s business climate (hayat and riaz, 2011. as a matter of fact, all smes together with the large corporations, has a primary goal of survival. in phases of extreme competition, unstable environment and scarce resources smes are going through the challenges of transformation from transactional leadership to charismatic leadership style for their survival or improvement in compatibility in the marketplace (trajko et al., 2014). gamba and komo (2014) contends that for a country to accomplish economic development, smes ought to be capable to generate new employment opportunities, increase profitability, utilize numerous competencies of south asian review of business and administrative studies vol. 4, no. 1, jun 2022 3 the entrepreneurs, negotiation power, increase accessibility of finance, raise social capital, give marketplace access, encourage investment by investors and play their role in poverty alleviation. to put it in another way, growth of smes is an attractive end, as an important driving force of economic growth and employment. leadership style can either motivate or discourage employees, which in turn increases or decreases the economic growth of a country. in any type of firm understanding of strategic leadership is critical as the job has become more analytical and complicated demands have elevated in smes (wang and howell, 2012). the main objective of this study is to answer the queries like; what is the role of transformational leadership in smes? how each component of transformational leadership effect smes? what are the outcomes of transformational leadership behavior? this study consists of five sections, first is introduction and importance of smes, second is transformational leadership in smes, third is components of transformational leadership, fourth is outcomes of transformational leadership in smes and fifth is conclusion. methodology the method applied in this research is systematic literature review. all the articles used in this study are recently published (not older than 12 years) in scimago journals. author was able to download 201 articles with keywords transformational leadership (tl), smes, leadership style, out of which 33 articles were downloaded twice which were excluded during duplicity checking. abstract of the remaining 168 articles were read thoroughly and 38 articles were excluded because of irrelevancy to the scope of study. this study included only empirical studies, 31 studies were excluded because those studies have different research design i.e., review papers and metaanalysis. in the third author analyzed the full text of the remaining 99 articles, 20 articles were excluded because they were related to the role of tl in mnps, giant corporations and large public and private companies,9 articles did not meet the quality check parameters and 10 articles expressed the relationship between tl and smes but didn’t explain the components and outcomes of tl in the context of smes. in the final step two more articles were excluded because of very low number of citations and finally 58 highly relevant and quality articles were selected for literature review. fig no. 1: flow chart of systematic review south asian review of business and administrative studies vol. 4, no. 1, jun 2022 4 transformational leadership in smes the attitude, actions and behavior of the leader determine leadership style adopted by an organization (franco and matos, 2015; men, 2014). however, when the firm is confronted with an unstable marketplace, when its merchandise faces birth, life and death within a couple of years, when its technical assets become outdated earlier than the expected life, at that point transformational leadership has been recommended as a surgical instrument to be promoted at every level of the enterprise. in order to be successful, the enterprise should have the ability to speculate and fulfill the changes and new demands. transformational leadership can empower the enterprise to do this. issues, fast changes, and vulnerabilities require an adaptable firm with a committed leader, who can motivate workers to take part passionately in group efforts and play a role in firm’s goals. briefly, willingness and ability to intellectually stimulate, charisma and individualized one of them (ilesanmi, 2019; subhan et al., 2013). transformational leadership style comparatively identifies with the survival ratio in dynamic environment, especially in contemporary developing markets like indonesia. it is realized that doing business in countries which are still emerging has never been an easy thing. hence a transformational leader notably influence the way sme is developed through inspiring, motivating and practically becoming an ideal model for workers to perform better than previous performance. a transformational leader can also influence breakthrough and policy making to make competitive circumstances favorable for firm (widianto and harsanto, 2017). frequently changing external environment requires suitable changes by the firm as well, to main competitive edge or improve its competitiveness in the marketplace. leader is the one who initiates the changes. since transactional leader is a change averse, so this style ends up being insufficient in the present conditions for business working of sme, previous literature indicates significant relationship between smes performance and transformational leadership regardless of goals setting at organizational or individual level (trajko et al., 2014). because the use of transactional or laissez-faire leadership is beneficial in situations where external and internal elements influencing the operations remains constant over time and the issues that show up are well known, simple and there are obviously defined ways for settling them (trajko et al. 2014). also, arham (2014) concluded that when a leader brings into use more transformational leadership practices and behavior, they ought to achieve better performance within their enterprises as compared to the transactional leadership and in respect of satisfaction, exceptional efforts and effectiveness laissez-faire style proved to be ineffective (trajko et al., 2014). paladan (2015) conducted study on leadership style of filipino smes and found that successful leader is considerably inclined towards transformational leadership style, and they consistently evaluate their leadership behavior as inspirational motivator. transformational leadership is an emerging and popular new leadership style which is considered an ideal style of effective leadership for successful entrepreneurial ventures. this leadership style is focused on values of interconnection between the leader (entrepreneur) and employee as a solid group (paladan, 2015). roslan et al. (2013) demonstrated significant positive association between transformational leadership and smes performance that is useful for enterprise’s success. out of all successful filipino transformational leaders 23% entrepreneurs often utilize the inspirational motivation leadership style along with 22% who employed idealized influence leadership behavior, 20% are those entrepreneurs who made use of intellectual stimulation and individual consideration. hence, out of four transformational leadership behaviors mostly used successful entrepreneurs in filipino smes is inspirational leadership behavior (paladan, 2015). garcia-solarte et al., (2018) conducted study on relationship of gender diversity and leadership style in cali (colombia) and stated that for the firms were comparatively more managerial positions are hold by women adoption of transformational leader behaviors is suggested. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 5 particularly gender diversity is positively related with individualized consideration, intellectual stimulation and inspirational motivation. out of this intellectual stimulation and individualized consideration behaviors of transformational leadership relate to women because of their inclination to be relationship and individuals orientated. burawat (2019) compared transformational and strategic leadership in setting of lean manufacturing and concluded that tl has an impact on lean manufacturing while sl doesn't. result of the study stated tl as a multidimensional leadership and indistinct between sl and tl which contends that one leadership style (tl) is more suitable in setting of lean manufacturing. manzoor et al., (2019) studied relationship between tl and job performance with mediating effects of smes in pakistan and found that csr and tl both affect job performance positively. tl has both direct and indirect impact on performance. csr strategies and qualities of tl could raise worker’s job performance. transformational leadership significantly determines organizational performance, knowledge management, organizational learning and organizational innovation (noruzy et al., 2013). components of transformational leadership there are four components of transformational leadership mentioned below: fig no. 2: components of transformational leadership. source: cetina and kinik (2015). inspirational motivation includes articulation of firm goals, communication of high-level expectations and convincing employees regarding the significance of firm goals. individualized consideration taking care of the follower’s needs individually, acting as a mentor to them and listening to their issues. idealized influence includes demonstrating charisma and confidence that stimulate loyalty strong feelings from adherents. intellectual stimulation includes supporting innovative attitude and activities and quitting existing norms and routines (ng, 2017). importance each of these factors in the context of smes is given be below: idealized influence/ charismatic leadership in smes transformational leadership displays charismatic yet ethical effect on employees (naber and moffett, 2016). charismatic leader arises as critical for competitiveness not just for giant firms but also, for smes (trajkoet al., 2014). idealized influence is based on the concept that followers respect and trust a leader to offer resources and support. because of this faith, employees will acknowledge the directions given by the leader, irrespective of their complexity and difficulty level south asian review of business and administrative studies vol. 4, no. 1, jun 2022 6 (chu and lai, 2012). their subordinates recognize them with their charismatic personality and attempt to copy them. eight characteristics that contributes to the success of leaders in smes include flexibility, expertise, authenticity, self-knowledge, charisma, vision, ability to inspire and motivate followers and shared leadership. out of all these charisma is most significant tl influential attributes. charisma when utilized properly, is highly effective however can cause devastation when utilized improperly (rolfe, 2011). nguyen and nguyen (2014) stated that idealized influence is the second important factor that affects job performance positively in smes. leaders with idealized influence establish a specified belief among their followers and subsequently leaders can communicate their inspirational motivation to all of them. in a sme if a leader implant trust in subordinates, high morality, become a role model for workers motive to towards risk taking, all these have positive effect on employees working and performance levels. idealized influential leader urges employees of smes to perform at their full capacity for the development of sme. cl is significantly related with coordinated teamwork (ekmekcioglu et al., 2018). cl leads employees towards work engagement impact organizational citizenship behavior directly and through mediating effect of work engagement (babcock-roberson and strickland, 2010). baah (2020) conducted research on relationship between dimensions of transformational leadership and quality of work life and found that out of four transformational leadership behavior idealized influence is the strongest predictor of quality of work life. along with showing positive aspects of charisma there are certain studies which stated charisma as double edge sword mentioned darker sides of charismatic leadership. there is positive relationship between charismatic leadership and un-ethical pro-organizational behavior (zhang et al., 2020). charismatic leadership sometimes results in negative outcome for work group and firm through victimizing behavior and work pressure (samnani and singh, 2013). but generally, as much as the leaders are ethically mature, to whom the lead show better moral and ethical reasoning. in its true meaning, idealized influence leadership should lay on the ethical establishment legitimate practices (ogola et al., 2017). it can inspire, innovate, increase loyalty, and motivate employees, commitment, performance and in job satisfaction smes. inspirational motivation in smes inspirational motivation is viewed as a critical component of transformational leadership. leaders who have high level inspirational motivation can transmit superior expectancies of their followers, motivate followers through inspiration to turn out to be more dedicated to and become part of mission and vision of the enterprise. inspirational communication alludes to the optimism displayed, cooperation, and eagerness. entrepreneurs get employees associated with an appealing vision and committed with targets (yaslioglu & erden, 2018). they motivate their followers to go beyond their personal benefit and interest for the welfare of others (paladan, 2015). inspirational leaders support up the values and targets of their employees to the enterprise mission or objectives and then transfer power to adherents to accomplish them ((rehman t al., 2019), encourage follower to challenge everyday practices and methods in such a way that both firm and employees develop and grow parallel (seyal and rahman, 2014). study figured out the leadership style being used in successful filipino smes. successful filipino leader exhibits a recognizably higher tendency toward transformational leadership and constantly ranked themselves high in inspirational motivation for their behavior as a leader. in this way, the arising leadership style of successful filipino leaders is transformational leadership’s component inspirational motivation. successful entrepreneur’s leadership practices contain inspiring and sharing the vision of their firm to their followers and instilling the belief and values of their firm to their followers (paladan, 2015). intellectual stimulation in smes intellectual stimulation implies a circumstance where entrepreneurs stimulate their adherents to be creative, innovative and to challenge their own beliefs and values (megheirkouni ur rehman etal., south asian review of business and administrative studies vol. 4, no. 1, jun 2022 7 2019), employees are boost up to raise their voice, converse their issue, seek solutions and attempt new strategies (yaslioglu and erden, 2018). the consequences of intellectual simulations come in the form of increase in the ability of adherents to examine, conceptualize, and grasp issues and in the better-quality solutions (rehman et al., 2019). intellectual stimulation is linked with perceived leader integrity and moderate the relation of empowerment and integrity. particularly when follower’s intellectual stimulation is higher, leader’s integrity has a very strong positive impact on worker’s empowerment (smothers et al., 2016). the leaders of fast-growing smes encourage followers, stimulate new techniques of problem fixing by encouraging workers to challenge the existing state-of -affairs, promote cooperation inside the association, act as good examples and give a guide so employees, know their direction. it is significantly essential that leaders share their upcoming plans as change is viewed as the standard rule, and not the exemption, in fgsmes. (tan et al., 2014; bass & avolio, 2004; elkins & keller, 2013; sundi, 2013). palalic and durakovic (2018) conducted research regarding ceo’s leadership style of gazelles and mice in australia. according to findings of the study gazelles are more inclined towards transformational leadership than mice. mice to turn into gazelles and gazelles to maintain and improve their growth should enhance intellectual stimulation which can produce and create proactiveness for long period of time, providing them additional synergy and strength to become first mover in the marketplace. ogola (2017) found that in smes superior performance is achieved when followers urged to reexamine presumptions, critical thinking while issue resolving, utilization of innovation and creativity while performing their task or job. so, this study suggests the adoption of intellectual stimulation smes leaders. as employees involvement in resolving problems of the firm will be beneficial for both employees and enterprise (paladan, 2015). intellectual stimulation increases the employee commitment with the firm. this sequentially led to the organizational ability to accomplish its goals with the help of hard work and devotion of employees. it is strongly related with it employee’s choice to stay with or quit the firm. their commitment with job can be increased by designing and creating jobs that flash excitement, learning and enthusiasm on the work (anjali and anand, 2015). individualized consideration in smes individualized consideration refers to take individuals into consideration during transformational process of a firm. it is the consideration of follower’s individuality. this gives rise to the need to analyze their desires, abilities, necessities and qualities in the correct way. this sort of activity prompts more significant levels of trust in the supervisor. other than the global image, a tl leader must realize what inspires each of his subordinate individually. human needs and wishes are distinct, someone want change and excitement, someone certainty, someone prefers leisure time and other prefer money. leader who knows desires of followers, has a chance to utilize each of those different wishes in best way. by their conduct, tl leader exhibits acceptance of differences among individuals and allocate errands as per their own affinities (ogola, 2017). in order to provide necessary support to the employees in smes supportive leadership needs noteworthy understanding of the employee’s wants and needs. for the confirmation of effectiveness of supportive leadership, it is imperative for the firm leader to plan pleasant correspondence environment with their adherents (al-malki and juan, 2018). individualized consideration is a fundamental leadership style that treats individual employees as important contribution in work environment. leaders are ready to encourage and mentor them to accomplish firm goals (seyal and rahman, 2014). when leader assists transform followers in fundamental manner, that adds to the performance behavior of employees and belief in the leader that both are helpful in achievement of the firm goals (paladan, 2015). outcomes of transformational leadership in smes following are the outcomes of tl in smes: south asian review of business and administrative studies vol. 4, no. 1, jun 2022 8 survival and performance of smes to measure the performance of the firm eleven indicators are studied including return on assets (roa), return on sales (ros), market share growth, overall profitability, customer satisfaction, sales growth, service/product quality, customer satisfaction, qualified labor, job satisfaction of employees, commitment of employee (özer and tınaztepe, 2014). performance of an smes includes profitability and growth (arham, 2014). performance measures growth and profitability are interchangeable terms, growth of firm is linked with profitability. there is a significant relationship between performance of smes and transformational leadership (arshad et al., 2016). employee citizenship behavior is the most powerful factor that extensively in the accomplishment of firm performance. it is said that leadership strongly affects the attitude and behavior of employees towards their work (baah, 2020). transformational leadership in it sector of pakistan is strongly associated with employee citizenship behavior (khan et al., 2013). rolfe (2011) stated that although transformational leadership cannot be claimed perfect model, however its successful style in current unstable environment because of its feature to transform firms through its personnel while achieving desired results. transformational leadership draws such interest due to its relevance and significance to firm. research stated that employees under transformational leadership are far more productive. whether the performance is measure at the team or individual, firm or the unit level (barrick et al., 2015), regardless of the performance outcomes in the form of innovation, with-in role task or extra-role tasks (chen et al., 2013). tl has a great impact on firm performance and recognition with leader mediates relationship between transformational leadership, total performance and organizational citizenship behavior (ng, 2017). smes are likewise influenced by regional and global financial crises which require the need for good leadership in the development and growth of that sector. with the transformational leadership style leader develop the requirement for significant changes by building up the adherent's attitude for the future and by establishing their commitment for firm growth more than expected (kent and chelladurai, 2001). different leadership practices and firm performance of services sector smes are strongly related, and transformational leadership contributes more remarkably to sme’s performance than transactional leadership style (arham, 2014). özer and tınaztepe (2014) conducted research on impact of three leadership style transactional, transformational and paternalistic leadership on firm performance of smes in turkey. in contrast with other leadership styles transformational leadership strongly effect enterprise performance. transformational leadership portrays clear image of future scenario, which is both attainable and optimistic, urge to expectations rise, lessen complexity to important problems, and make use of easy language to transmit the mission in aggressive markets like turkey. the response of the employees is escalated willingness to put additional exertion to attempt to accomplish the mission. widianto and harsanto (2017) studied the link between cultures, transformational leadership, entrepreneurial organization and performance of firm and concluded that both culture and transformational leadership are driving force of entrepreneurial organization which leads to firm performance. transformational leadership enhance temporal flexibility by improving leader’s abilities in terms of stimulation development, visionary leadership, management by exception and contingent reward (mesu, 2013). various examinations conjecture that transformational leadership is connected to good performance contrasted with transactional leadership as they will motivate workers to deliver high performance. boedker et al., (2011) added more that transformational leadership might lead to a superiorperformance firm because of participative, supportive, collaborative, follower-leadership relationship that develops in a firm. the workers are enabled and feel committed and compelled to helping with achieving the objectives and goals of the association. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 9 organizational learning and innovative behavior a constant pressure from intense competitors at marketplace force smes to innovate. due to this the capacity to contend in innovation is considered as a vital component of their competitiveness. (lesáková, 2014; ng and kee, 2018).). innovative actions of followers have incredible significance for firm’s survival and effectiveness (choi et al., 2015). the presence of innovative culture and creativity in work environment motivates followers to voluntarily generate value added ideas, especially in smes (maladzhi and yan, 2014; mittal and dhar, 2015). afriyie, (2019) stated that transformational leadership act as a moderator in relationship of marketing performance and innovation in smes. the examination results stated that organizational learning impacted organizational performance indirectly through the organizational innovation and knowledge management and directly as well. innovation is straightforwardly identified with firm performance. increment in business performance influence the competitiveness, chances of survival and expansion (sheshi and kërçini, 2017). transformational leadership is committed with and encourage organizational learning by accelerating the process to address the hindrances that might disrupt this learning process. organizational learning is intending to make a way for professional advancement to obtain aptitudes and abilities that leads to sustainable advantages through innovation. the innovative enterprise understands and learns the way to become competent. organization learnability and transformational leadership are very important pointers of the inner conditions that organizations need to become innovative (begum et al., 2020). transformational leaders promote the striving of their followers regarding creativity, performance and innovation. they evoke regular re-examination of parameters, invigorate in the way of considering issues, and exhort utilization of metaphor and analogy among others. it might hence give the idea that they have the chance to get creative and innovative ideas for resolving issues from the followers. on the occasions if the idea and the solutions of issues suggested by followers is distinct from the views recommended by leader, the followers are not condemned and at any cost supervisor’s thoughts are not implemented (ogola et al., 2017). transformational leadership’s basic assertion is that the supervisor can create effective associations with subordinates in the environment, where each of them endeavors to achieve firm’s goals important to satisfy the vision. an interdependent and reciprocal connection follows, enhancing sense of belonging and trust. innovation is the “pre-condition for survival and enterprise’s success, reflects in the shape of learning orientation, market orientation and entrepreneurship and transformational leader has significant contribution in innovation (aslan et al., 2011). ogola et al., (2017) conducted research on leadership style of ceos of top100 kenyan smes and come up with finding that leadership style of successful entrepreneurs is intellectual stimulation (transformational leadership). leaders always motived their followers to think critically before making decision and followers performed their tasks efficiently and effectively. leaders which intellectually stimulate their subordinates impacted them to inspect things fundamentally and discover new solutions to work related problems and, in the process, urges them to remain positive and motivated. intellectual stimulation is strongly related with additional exertion done by employees. so successful entrepreneurs use transformational leadership to encourage innovation and in turn success of firm. aslan et al., (2011) conducted research on smes in konya (turkey) and stated that strategic transformational leadership impacts innovation and strategic change through the analysis of uncertainty in external environment. leadership behaviors concentrated on human resources and transformation is significantly more fruitful at innovation. employees with high perceived organizational support through inspirational, motivational and charismatic leadership are more inclined towards innovative performance in malaysian smes (liao et al., 2017; theodore, 2013). south asian review of business and administrative studies vol. 4, no. 1, jun 2022 10 i̇şcan et al., (2014) conducted research on relationship of different leadership style, innovation and perceived organizational support and concluded that transformational leadership has more meaningful influence on both innovation and perceived organizational support than transactional leadership and further they found a significantly positive relationship between innovation and enterprise performance in turkish smes. cortes and herrmann (2020) argued that in ecuadorian smes, transformational leadership provide basis for in promoting innovation in smes either directly or may be indirectly through increasing the enterprise’s level of social capital and performance. seyal and rahman (2014) selected 100 private smes from a key business directory of brunei darussalam for analysis and concluded that two components of transformation leadership inspirational motivation and individualized considerations are most important predictor of enterprise resource planning (erp) adoption in smes of brunei darussalam. those leaders who use these leadership behaviors can reap advantages of erp including increased productivity (seyal and rahman, 2014). tan et al., 2014 analyzed a comprehensive model that links transformational leadership, hr practices and organizational climate and organizational climate in fastgrowing smes in australia. results demonstrated that these factors contribute fundamentally to the development of learning organization, particularly transformational leadership influenced learning organization by creating open and supportive climate, bringing flexibility into task related hr systems, stressing upon employee motivation and satisfaction. interestingly bonuses and rewards relevant to performance does not have significant contribution in learning organization. conclusion this study used the literature review method to analyze the role of transformational leadership in smes, it is concluded that among all advanced leadership practices which include transformational leadership, transactional leader and laissez-faire leadership, and transformational leadership style is most suitable for smes. although few studies stated transactional leadership style more appropriate for smes (hayat and riaz, 2011) but most of studies which compared leadership styles in context of smes argued that transformational leadership is perfectly related with survival and goals achievement of smes in current situation where smes are facing strong competitors, changing trends, products out dating and obsoleting, unstable and vulnerable external environment and scarcity of resources which all force smes to change and innovate. 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issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas organizational social capital: indicators and measurement hafsa siqqique, university of the punjab, pakistan kalsoom akhtar, department of management sciences, comsats university islamabad, pakistan. afaq ahmad, school of business administration, zhongnan university of economics and law, china. article details abstract history revised format: nov 2020 available online: dec 2020 keywords organizational social capital, social capital, indicators, determinants, confirmatory factor analysis, measurement social capital is broadly defined as an asset that lies in social networks and relations. literature highlights that the indicators and a definite model to define social capital is still under a debate. this study focuses on identifying the most common indicators for defining social capital and testing them in the local context of pakistan. thorough literature review identified eight common indicators for the structural, relational and cognitive aspects of social capital and an adapted questionnaire was used to obtain data from the selected population i.e. permanent faculty members of university of the punjab. confirmatory factor analysis was conducted to test these indicators, which highlighted nine indicators in the factor loadings. since the theme of most of the factor loadings was similar to the original indicators tested, the model is thus said to be verified. this means that the selected indicators i.e. ‘information sharing’ and ‘communication’ for structural dimension; ‘trust’, ‘networks’ and ‘collective action and cooperation’ for relational dimension; and ‘shared vision’, ‘social cohesion and inclusion’ and ‘influence’ for cognitive dimension have been proven to be valid to gauge the concept of social capital. furthermore, results highlight that the selected organization has moderate levels of social capital and need to improve the quality of relations among the employees. this paper lays the foundation for human resource practitioners as well as researchers to identify in future researches how organizational social capital can be optimally utilized for improved performance. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: hafsaasiddiqi@gmail.com doi: https://doi.org/10.52461/sabas.v2i2.446 introduction in an organizational setting, social capital is defined as “features of social organization that involve mutual trust, norms of reciprocity, and social networks that enable people to act collectively, thereby more effectively pursuing a common purpose” (loch, souza, mesas, martinez-gómez, & https://journals.iub.edu.pk/index.php/sabas mailto:hafsaasiddiqi@gmail.com https://doi.org/10.52461/sabas.v2i2.446 south asian review of business and administrative studies vol. 2, no. 2, dec 2020 82 rodríguez-artalejo, 2015). the topic has been studied at various levels, from national (fukuyama, 1995) and community (putnam, 1995) levels to organizational (leana & buren, 1999) and individual (belliveau, o'reilly, & wade, 1996) levels. for the purpose of this study, we will be focusing on organizational level social capital. at this level, social capital points towards the quality of relations among members of the organization. the quality is assessed through the nature of relationship among these people as well as through the patterns and flow of communication within the organization. if any particular organization has been found to have higher levels of social capital, it is ascribed to many different advantages, like improved performances, better access to resources, effective communication, optimum use of intellectual capital and more collective action (adler & kwon, 2002; hansen, 1999). in the current stream of literature, the work on defining and measuring social capital seems to be rather lacking depth and consensus (poder, 2011). a number of studies have pointed out that there is still a significant debate as to which indicators of social capital are most suitable (onyx & bullen, 2000). it is for this reason that this study targets to dig out the most frequently pointed out indicators of social capital and test their validity in the organizational context of pakistan. moreover, using the identified indicators, the levels of social capital have been measured in the selected organizational context. this research aims to highlight the components of healthy relation among the employees in any organizational context. the selected population i.e. faculty members of university of the punjab, is particularly important for this study because healthy relations and effective information exchange are one of the vital components of effective teaching. there is an ample literature highlighting that frequent communication and quality oriented interactions among the teachers lead to better performance of the educational institutes (bryk & schneider, 2002; spillane, halverson, & diamond, 2001; hargreaves, 2003) as well as its products i.e. the students of it (leana & pil, 2006). leadership in educational institutes demands an efficient utilization of its social resources to impart knowledge and promote learning. leaders in these institutes work in collaboration with the teachers to institutionalize any change because teachers are the ones who are in direct contact to the learners (spillane, halverson, & diamond, 2001). on the other hand, public sector, in particular, is known for stringent routines and bureaucratic rigidity (srason, 1990). because of these reasons, it is important to come up with more creative and dynamic teaching models, moving from fixed autonomies to flexibility to promote effective transmission of knowledge (mclaughlin & talbert, 2001). in pursuing this collective goal of enhancing the performance of the educational institutes as well as its products, information sharing, healthy relations among the educationists, sharing the common vision can potentially contribute well (bryk & schneider, 2002). literature review the definition of social capital given by coleman (1988) is of a functional nature. according to him, social capital is comprised of a combination of various social entities. it emphasizes that society is not just an accumulation of individual actions, rather it is system, where people, in pursuing their self-interests, connect to one another, form social relationships and hence become resources for one another. this means that this social capital becomes the source for all these individuals to achieve their self-interest. it signifies the nature and strength of relationship among individuals within an organization (or any other group) entity and defines the pattern of communication (leana & pil, 2006). the advantages that can be derived from this setting then are better communication and enhanced utility of intellectual capital (leana and van buren 1999, hansen 1999). fukuyama defines it as “"the ability of people to work together for common purposes in groups and organizations" (1995:10). thomas, on the other hand, defines social capital south asian review of business and administrative studies vol. 2, no. 2, dec 2020 83 as “"those voluntary means and processes developed within civil society which promote development for the collective whole" (1996: 11). some of the researchers are of the idea that this multiplicity and confusion in the theoretical confines of the concept is a failure of those working on it, however, others are of the view that this wide array of the concept of social capital can be taken to be “suggestion box rather than a global concept” (poder, 2011, p. 342). poder (2011) thus uses the term ‘quasi’ for the use of the notion of social capital, which means that different authors have used it in different contexts and for different purposes. what one author means by social capital may not be same as the other author. the indicators that are used for the term, the contexts in which it is used and the levels at which it has been differentiated are all varied widely across the literature. where the concept was originally used at macro levels for the community researches (jacobs, 1965) to analyze the resources embedded in its social relations, it has now been applied to micro levels as well to inter-organizational and even intra-organizational studies (burt, 1992; nahapiet & ghoshal, 1998). social capital at organizational level: the first person who introduced the notion of social capital at organizational level is robert putnam, who has had splendid contributions in popularizing (poder, 2011) and measuring (putnam, 1995) it. he defined this concept as “features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit" (putnam1995, p. 67). at an organizational level, social capital is taken as an asset based on the relations within the organization, and the investment in such an asset is made whenever a fruitful work-related interaction takes place among the participants of that organization. (johns, 2006; leana & pil, 2006). different definitions of social capital hold in the organizational setting. the most appropriate definition has been given by bourdieu (1980) for social capital at organizational level. according to him, social capital in an organization is “the aggregate of the actual or potential resources which are linked to possession of a durable network of more or less institutionalized relationships of mutual acquaintance or recognition” (bourdieu, 1980, p. 2). other definitions also suggest that social capital in an organization is basically the goodwill-the goodwill of one individual or a group of individuals towards the other individual or groups. this goodwill is considered as a valuable resource for an organization and it may help in achieving the ultimate organizational objectives and goals (biggart & castanias, 2001). hence, social capital can be defined as relationships that individuals have among themselves and that they have with the organization which aid collective action and enhance overall value of the organization (adler & kwon, 2002). it has also been regarded as a resource or an asset that, with its contribution and impact on human resource practices, can influence organizational performance as well (collins & clark, 2003). some researchers have also studied and tested it along with human resource practices and organizational performance (leana & pil, 2006; chuang, chen, & chuang, 2013; khalid & khan, 2014). dimensions/indicators of social capital: nahapiet and ghoshal (1998) have introduced three dimensions of social capitalstructural, relational and cognitive. the structural dimension is about how individuals are connected to one another and how information and communication flows among them. this includes the extent to which the employees are connected; the patterns through which these connections are built and how advantageous are these connections to these members and their subject settings. this has been measured by information sharing by leana & pil (2006). secondly, relational aspect “describes the kind of personal relationships people have developed with each other through a history of interactions”. the indicators of this dimension were specified south asian review of business and administrative studies vol. 2, no. 2, dec 2020 84 as trust, shared vision and norms and a sense of associability (bolino, turnley, & bloodgood, 2002). among these indicators, trust is the key factor to which most of the contributors have agreed uponlike nahapiet and ghoshal (1998), leana and pil (2006), bolino et al. (2002). the cognitive aspect, on the other hand, is about a group of people having a common goala shared vision, which binds them together and makes them collaborate and cooperate with one another. this shared vision has been termed as “shared destiny” by adler & kwon (2002). the most common indicators of it are common language and narratives among the members (bolino, turnley, & bloodgood, 2002). zahra (2010) emphasizes the relational aspect of social capital in an organization as among the contributing factors in building relationships among the firms thus enabling them to exchange resources and knowledge. by the exploitation of such resources, the firms in these relations can enhance their performance and credibility among others (sirmon & hitt, 2003). the study conducted by boyas, et al. (2012) to study the relationship of employment-based social capital with burnout, job stress and intention to leave among workers identified trust, organizational commitment, perception of fairness, peer support and communication levels as indicators of social capital. these indicators are more of relational nature, however, the study pointed out the cognitive dimension of social capital as well. the dimensions of cognitive form of social capital which were then empirically tested in this study were trust (or cooperation), social relations, organizational commitment, communication levels, influence and perception of fairness. by taking these cognitive aspects of social capital, the author establishes that it is this aspect that influences the stress level, and ultimately commitment of employees with the organization. however, where the author states that these selected indicators are the most frequently occurring ones in literature, it has also been made clear that the list is not exhaustive, and a different set of indicators taken for a certain research may give entirely different results. krishna & shrader (1999) in their social capital assessment tool developed for world bank used values, like trust, solidarity and reciprocity, attitudes, beliefs and behaviors as cognitive aspects of social capital whereas networks and horizontal structures as structural dimensions. in addition to that, another study has operationalized the structural component as ‘network ties’, relational component as ‘social interaction’ and cognitive component as ‘relationship quality’ (ylirenko, autio, & sapienza, 2001). ’social interaction’ here means the extent of relationship that the subject organization has with its customers or clients i.e. to what level are they related and connected. ‘relationship quality’ highlights whether there is goodwill and reciprocity norms in these interactions or not. ‘network ties’, however, signifies the frequency and level with which the existing customers become a source of connection to new potential customers for the firm (ylirenko, autio, & sapienza, 2001). mitchell & bossert (2007) have converged the indicators of social capital to ‘organizational membership density’ as sturctural dimension and ‘social trust’ as cognitive dimension. a study conducted in pakistan by saeed & arshad (2012) pointed out networking, social ties, relationships, trust, communication, information sharing, collaboration, reciprocal interaction, cooperation and collective action as the possible indicators of social capital, according to the reviewed literature. with all these indicators pointed out by the researchers over time, after their careful qualitative and empirical analyses, there is of course a need to categorize them into some broad classes that would represent the basic gist of all these indicators pointed out (krishna & shrader, 1999). moreover, krishna & shrader (1999) left an open question that if the defining factors or the determinants of social capital and the norms vary across the countries, cultures and contexts; are south asian review of business and administrative studies vol. 2, no. 2, dec 2020 85 there any universal measures that indicate the existence of social capital in any cultural context? much to answer this and other such questions, some of the most commonly found indicators of social capital have been tried and tested in multiple contexts and countries, which is also the target of this particular research. by taking the most commonly found measures of social capital from the literature, we shall be testing them empirically in our local context to see if they hold valid here in pakistan. it must be noted here that the scope of this study is confined to what has been defined as internal social capital or intra-organizational social capital (arregle, hitt, sirmon, & very, 2007). methodology this quantitative, cross-sectional study obtained data through an adapted questionnaire and tested through spss (bryman, 2008). the level of analysis is individual, as the individuals were asked to respond to the survey questionnaires (creswell, 2009). section one of the questionnaire comprises of the demographics, where the respondents were asked to mention their age bracket, their marital status, gender, highest qualification, years of employment in punjab university and the faculty they are working in. in section two, eight indicators of social capital have been included in the questionnaire i.e. information sharing, communication, trust, networks, collective action and cooperation, shared vision, social cohesion and inclusion and influence. each of these indicators was measured through a set of statements on which the respondents were to mark their level of agreement or disagreement on a five point likert scale. here, ‘information sharing’ and ‘communication’ are used as the structural dimensions; ‘trust’, ‘networks’ and ‘collective action and cooperation’ are used as relational dimension; whereas ‘shared vision’, ‘social cohesion and inclusion’ and ‘influence’ are used as cognitive dimensions. the indicators of information sharing, trust and shared vision were taken from the instrument used by chuang, chen, & chuang (2013). six items were used to measure ‘information sharing’ that were originally developed by hyatt & ruddy (1997). similarly, six items were used to measure ‘trust’, which were taken from pearce, bigley, & branyiczki (1998). ‘shared vision’ was also measured through six items, two of which were developed by tsai & ghoshal (1998) and, remaining four items were developed by sinkula, baker, & noordewier (1997). the indicators of ‘networks’, ‘collective action and cooperation’ and ‘social cohesion and inclusion’ were taken from the instrument of world bank developed by grootaert, narayan, woolcock, & jones (2003). the remaining two indicators i.e. ‘communication’ and ‘influence’ were taken from the instrument used by boyas, wind, & kang (2012) that was based on the model proposed by lowe & schellenberg (2001). the population selected for this research is the case of university of the punjab. the reason for selecting this particular institute is because it is the largest case in the sector and may potentially highlight the general levels of organizational social capital in public sector universities in pakistan. target respondents were the permanent faculty members of university of the punjab, lahore. as the geographic spread of the target population has been taken to be lahore, other campuses of the university (i.e. those in gujrat or jhelum) are outside the scope of this particular research. a sample of 270 respondents was drawn using simple random sampling technique. out of the 270 questionnaires distributed, 150 were received back, with an acceptable level of response rate at 55.6%, according to nulty (2008). findings & discussion as far as validity of the instrument is concerned, pilot testing was done prior to data collection on first thirty questionnaires, from where the face validity of it was verified. the construct validity, however, shall be verified by performing confirmatory factor analysis in the following sections. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 86 table 1: reliability statistics factor no. of items cronbach’s alpha information sharing 6 0.86 communication 5 0.71 trust 6 0.76 networks 4 0.81 collective action and cooperation 4 0.74 shared vision 6 0.91 social cohesion and inclusion 6 0.87 influence 4 0.81 since, all the values are greater than 0.6, hence the instrument is considered to be reliable (bryman, 2008). factor analysis in order to verify the factor structure of organizational social capital, confirmatory factor analysis has been performed. this analysis verifies whether the dimensions or indicators taken to measure a construct really do reflect the true meaning and essence of that construct or not (hair, black, babin, & anderson, 2010). moreover, cfa also confirms if the identified factor model fits on the given data (decoster, 1998). assumptions in factor analysis assumptions to perform factor analysis are more of conceptual nature than statistical. firstly there must be some underlying theory or model that feeds into your factor analysis. then, the variables taken for the purpose must exhibit interrelatedness in order to produce factors that represent them in together. lastly, there is a concern of adequacy of sample size while performing factor analysis (hair, black, babin, & anderson, 2010). table 2: kmo and bartlett’s test kaiser-meyer-olkin measure of sampling adequacy 0.914 bartlett’s test of sphericity sig. 0.000 this table shows the kmo measure of sampling adequacy to be 0.914. since it very close to 1 here, hence this value reflects that the sample size was adequate to perform confirmatory factor analysis (field, 2009). secondly, to confirm the validity of data, the sigma value for bartlett’s test for sphericity should be less than 0.05 (sarwar & qureshi, 2013). the able shows this value to be 0.000 which means it is significant and that the data is valid. this verifies that there is significant correlation among the variables taken. the table 3 below shows how much of variance is caused due to each factor. the method selected to do this was component analysis, since data reduction is the primary concern (hair, black, babin, & anderson, 2010). after extraction, 9 factors have been pointed out by spss to be most significant in the proposed model. since we asked for the eigenvalues only to be greater than 1, hence only factors with such eigenvalues have been extracted as being significant. the right most column of the table shows that more than 72 percent of variation is caused by these 9 factors. table 3: total variance explained component initial eigenvalues extraction sums of squared loadings rotation sums of squared loadings total variance cumulative total variance cumulative total variance cumulative 1 16.684 40.691 40.69 16.684 40.69 40.69 6.650 16.219 16.219 south asian review of business and administrative studies vol. 2, no. 2, dec 2020 87 2 3.429 8.364 49.056 3.429 8.364 49.056 5.493 13.397 29.616 3 2.104 5.131 54.186 2.104 5.131 54.186 3.960 9.660 39.275 4 1.617 3.943 58.130 1.617 3.943 58.130 3.534 8.618 47.894 5 1.411 3.441 61.571 1.411 3.441 61.571 3.317 8.091 55.984 6 1.260 3.074 64.645 1.260 3.074 64.645 2.215 5.401 61.386 7 1.171 2.856 67.501 1.171 2.856 67.501 1.736 4.235 65.621 8 1.096 2.672 70.173 1.096 2.672 70.173 1.502 3.663 69.284 9 1.008 2.459 72.632 1.008 2.459 72.632 1.372 3.347 72.632 10 .898 2.190 74.822 11 .781 1.905 76.726 12 .733 1.789 78.515 13 .643 1.569 80.084 14 .631 1.538 81.622 15 .599 1.460 83.082 16 .554 1.352 84.434 17 .529 1.289 85.723 18 .485 1.184 86.907 19 .471 1.150 88.057 20 .446 1.088 89.145 21 .382 .931 90.076 22 .371 .904 90.981 23 .346 .844 91.824 24 .321 .783 92.608 25 .283 .689 93.297 26 .273 .665 93.962 27 .270 .659 94.620 28 .241 .589 95.209 29 .228 .557 95.766 30 .222 .541 96.307 31 .199 .485 96.792 32 .185 .451 97.243 33 .180 .439 97.682 34 .158 .386 98.068 35 .149 .364 98.432 36 .137 .333 98.765 37 .126 .307 99.073 38 .120 .293 99.366 39 .102 .248 99.614 40 .086 .210 99.824 41 .072 .176 100.00 the scree plot shows that the highest percentage of variance is caused by the first two factors, which can also be cross checked from the table 3 above, where the percentage of variance caused by first two factors is 16 and 13 respectively. no other factor has a percentage variance above 10. table 4: rotated component matrix 1 2 3 4 5 6 7 8 9 confidence in one another .776 considerate of feelings .753 show integrity .712 can rely on co-workers .711 trustworthiness .650 south asian review of business and administrative studies vol. 2, no. 2, dec 2020 88 share information .649 .430 keep each other informed .608 .408 constructive criticism .584 open/honest comm. .581 .425 work related information .570 no hidden agendas/issues .519 agreement to vision .813 commitment to goals .755 commonality of purpose .754 collective goals/ mission .449 .717 same ambition/vision .448 .682 partnership in charting direction .607 feeling of togetherness .424 .518 common goals .485 co-workers visit my home .877 visit co-workers’ homes .865 get together for recreation .757 meeting in public places .744 participate in ceremonies .511 feedback/ decision imp. .783 truthfulness of boss .777 boss asks for my opinion .628 invited to voice opinion .595 .435 give assistance .767 get assistance .737 count om co-workers .691 cooperation of people .527 close friends at workplace .471 influence decisions .773 say in the way group performs tasks .608 cooperation in org. prob. .472 comm. with higher mng. .797 feel valued in interaction .628 benefit of organization .801 discuss personal problems .426 no team spirit .733 this table shows the factor loadings. we will take the factor loadings that are equal to or greater than 0.5 to identify which statements have been loaded under which factor (hair, black, babin, & anderson, 2010). now to identify the factor to which any given statement belongs, we have to see the highest loading that each variable (i.e. statement) has for any given factor. in this table, the first five statements have been loaded only under one factor each, hence there is no need to look for the highest loading value. as for the sixth and seventh variables, both of them have been loaded under one and second factor each, so we will take the higher of the two values. since there are no cross loadings seen in this table, as each variable has a loading equal to 0.5 or higher under only one factor, the identification of corresponding factor becomes easier for each variable. according to the statements that have been loaded under the same factor, the factors have south asian review of business and administrative studies vol. 2, no. 2, dec 2020 89 been renamed. four statements from the original model have been excluded in this table, since they did not show a significant loading under any factor. factor 1 under factor 1, fourteen statements in total were loaded, out of which 11 were statistically significant to be considered. since information sharing and communication are similar terms, and trust is also enhanced as the level of communication increases, hence this factor is labeled as ‘communication’. factor 2 ten statements were loaded in total under factor 2, out of which 7 can be seen to be statistically significant. the first five of these statements were used to measure the construct of ‘shared vision’ in the original source (chuang, chen, & chuang, 2013). however, the last statement was used to measure ‘social cohesion and inclusion’ in the source from where it was taken (grootaert, narayan, woolcock, & jones, 2003). as all of them, except for just one, were used to measure shared vision, the label for this factor may remain the same for our results as well, only with an additional statement to measure it. factor 3 factor 3 showed five loadings under it, all of which were significant. all of these statements were used to measure the construct of ‘social cohesion and inclusion’ in the source instrument as well (grootaert, narayan, woolcock, & jones, 2003), hence there is no need to change the label for this. factor 4 factor 4 also had five factor loadings, out of which four were significant. the first two of these statements were used to measure ‘communication’ and the other two were used to measure ‘influence’ both in the study of boyas, wind, & kang (2012). as the label of communication has already been given to the first factor, we use the label of ‘information sharing’ here since that seems to be the implicit theme in all these statements. factor 5 factor 5 had 5 factor loadings, with only four of them statistically significant. the first three of these statements were used to measure the variable of ‘networks’ whereas the last statement was used to measure ‘collective action and cooperation’ in the source instrument developed by world bank (grootaert, narayan, woolcock, & jones, 2003). since there is only a difference of one statement, hence we shall continue using the label of ‘networks’ for this factor. factor 6 factor 6 has three statements loaded under it, two of which were significant. as these statements were used to measure ‘influence’, in the source questionnaire (boyas, wind, & kang, 2012), hence there is no need to re-label this one. factor 7 factor 7 had three factor loadings, but only two of them are significant. because both these statements were used to measure ‘communication’ in the original source (boyas, wind, & kang, 2012), and that label has already been given to the first factor, so we shall label this factor as ‘positioning’, as both the statements reflect communication that is based on positioning in an organizational hierarchy. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 90 factor 8 this factor had only two factor loadings, out of which only one was statistically significant. as this statement reflects commitment towards the organization, hence it has been relabeled as ‘organizational commitment’. factor 9 factor 9 had only one factor loading. as this statement talks about teamwork, hence this factor can be given the label ‘collective action and cooperation’ • levels of social capital information sharing since information sharing has been measured using 6 statements; hence the maximum score for it can be 5*6= 30 (i.e. if a respondent marks 5 for each statement) and the minimum score can be 1*6= 6 (i.e. if a respondent marks 1 against each statement). to create the three categories of this variable i.e. high, medium and low, this range from minimum score to maximum score is to be divided into three classes. to calculate the class interval for these classes, following formula has been used: class interval= (upper class limit – lower class limit)/3 in this case, the upper class limit is 30 and the lower class limit is 6, so the interval will be (30 – 6)/3= 8 so the classes for this variable are: • low (6-14) • medium (15-22) • high (23-30) now, upon calculating the frequencies, it can be observed how many respondents fall into each respective category of the score. table 5: frequency of categories of information sharing information sharing categories frequency percentage high 41 27.3 low 29 19.3 medium 80 53.3 this table shows that majority of the respondents signaled medium levels of information sharing in their organization. communication the same procedure shall be used to create the categories of communication. • low (5-12) • medium (13-19) • high (20-25) table 6: frequency of categories of communication communication categories frequency percentages high 42 28 low 14 9 medium 94 62.7 this table shows that most of the people have pointed out medium levels of communication in their organization. trust • low (6-14) • medium (15-22) • high (23-30) now, upon calculating the frequencies, it can be observed how many respondents fall into each respective category of the score. table 7: frequencies for categories of trust south asian review of business and administrative studies vol. 2, no. 2, dec 2020 91 trust categories frequency percentages high 30 20 low 18 12 medium 102 68 this table shows that most of the people have pointed out medium levels of trust in their organization. networks • low (4-9) • medium (10-15) • high (16-20) the table 8 below shows that most of the people have pointed out medium levels of networks in their organization. table 8: frequencies for categories of networks networks categories frequency percentages high 69 46 low 7 4.7 medium 74 49.3 collective action and cooperation • low (4-9) • medium (10-15) • high (16-20) table 9: frequencies for collective action and cooperation collective action and cooperation categories frequency percentages high 70 46.7 low 4 2.7 medium 76 50.7 this table shows that most of the people have pointed out medium levels of collective action and cooperation in their organization. shared vision • low (6-14) • medium (15-22) • high (23-30) table 10: frequency of categories of shared vision shared vision categories frequency percentages high 56 37.3 low 26 17.3 medium 68 45.3 this table shows that most of the people have pointed out medium levels of shared vision in their organization. social cohesion and inclusion • low (6-14) • medium (15-22) • high (23-30) table 11: frequency of categories of social cohesion and inclusion social cohesion and inclusion categories frequency percentages high 32 21.3 low 41 27.3 south asian review of business and administrative studies vol. 2, no. 2, dec 2020 92 medium 77 51.3 this table shows that most of the people have pointed out moderate levels of social cohesion and inclusion in their organization. influence • low (4-9) • medium (10-15) • high (16-20) the table 12 below shows that most of the people have put forth that they experience moderate level of influence in their organization. table 12: frequencies for categories of influence influence categories frequency percentages high 36 24 low 17 11.3 medium 97 64.7 the results of confirmatory factor analysis show that the eight indicators selected in this study were appropriate enough to gauge the concept the social capital at organizational level. this confirmatory factor analysis confirms seven out of eight indicators taken from various sources to be the appropriate measure of social capital. three of these indicators i.e. information sharing, trust and networks were also confirmed by the study of leana and pil (2006). out of these, the trust variable had been endorsed by pearce, bigley, & branyiczki (1998) and that of shared vision was also verified in the study of tsai & ghoshal (1998). out of the nine factors that were given in output, the labels for six of them have been reserved because of insignificant changes in their measuring statements. these indicators were information sharing, communication, shared vision, social cohesion and inclusion, networks and influence. evidences for the further three factors given in output, that have been labelled as ‘organizational commitment’ (boyas, wind, & kang, 2012), ‘positioning’ (lin, 2001) and ‘teamwork’ are also found frequently in literature. this confirms two facts here: 1. that the indicators have been rightly pointed out in the literature, and 2. that the indicators taken for the quantitative measurement for the purpose of this study also do measure the concept of social capital adequately. the ‘trust’ indicator highlighted by poder (2011), adler and kwon (2002) has been included in the label of communication in these results because of the placement of their loadings. however, information sharing and networks used by these two have been confirmed in this study as well. information sharing was also used by leana and pil (2006) as an indicator of social capital. networks was also used by burt (1982), which establishes that this happens to be among the initially identified indicators of social capital at organizational level. then, shared vision, which has been used by leana and pil (2006) and nahapiet and ghoshal (1998) has also been confirmed in this study. adler and kwon (2002) used the term of ‘shared destiny’ for it. lin (2001) used the term of ‘hierarchal structures’ to what has been referred here as ‘positioning’, whereas adler & kwon (2002) used the term of ‘closure’ for it. to answer the second research question, each indicator of osc had been assigned three categories i.e. high, medium and low and the frequencies of responses for these categories were taken for each indicator. the results show that for each indicator of osc, the highest percentage of responses fell in the category of medium. this not only shows that a moderate level of social capital has been observed in punjab university, but also verifies that this set of indicator gauges the concept sufficiently, as each indicator gives similar result. this means that faculty members in punjab university get along well with one another, but there is still a margin of great improvement in it. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 93 to improve the status and quality of these relations, university must promote some relationship building activities and ensure that the faculty members can have greater confidence among one another and collaborate better for the overall organizational benefits and for the performance of students as well. conclusion the study concludes that information sharing, communication, trust, networks, organizational commitment, shared vision, social cohesion and inclusion, positioning, teamwork and influence are the appropriate indicators to gauge the levels of organizational social capital. as for the levels of social capital analyzed in the subject population, punjab university has been found to have moderate levels of social capital. this study sheds light on the fact that organizations can benefit by investing in the development of their internal social capital and sets the foundation for its measurement as well. it also highlights that the target population needs to invest to improve the current levels of its social capital, not only for the expected improvement in its own performance as an organization but for the benefit of its students and other stakeholders as well. the greatest limitation of this study is the fact that it only entails quantitatively analysis, whereas whenever an abstract concept is to be measured, it should be accompanied by qualitatively analysis as well. due to the limited time, qualitatively analysis has not been included in this study. another limitation is the confined population. for better verifiability of the concept and the proposed model, a study should have been conducted on a wider scope of population. this analysis must be accompanied by the qualitative analysis as well to properly assess the levels of social capital in the target population. moreover, wider scope of population must be studied, for which a study can be conducted on perhaps all public sector universities of lahore. just as literature highlights a significant relation of social capital with organizational performance, this relation can also be tested in this context in future. similarly, the impact of higher levels of social capital among the teachers on their students must also be empirically tested. future studies may also explore the set of hr practices that organizations employ to boost their levels of social capital. moreover, just as educational sector has been focused in this study, along with the rationale for choosing this sector, the significance, identification and relationship of social capital can also be studied in other sectors as well. references adler, p. s., & kwon, s.-w. 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(2010). harvesting family firms' organizational social capital: a relational perspective. journal of management studies, 47(2), 345-366. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 96 south asian review of business and administrative studies vol. 1, no. 2, december 2019 111 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.2, december 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas investigating the relationship between personality traits and workplace bullying: moderating role of work climate sumera shoukat, government sadiq college women university, pakistan waseem ul hameed, universiti utara, malaysia article details abstract history revised format: nov 2019 available online: dec 2019 keywords agreeableness, conscientiousness, extraversion, neuroticism, openness to experience, work climate, workplace bullying the research on bullying at work has risen significantly over the last 26 years. this paper is intended to study and summaries the current empirical research on fundamental and interfering processes in antecedents–bullying relationships. numerous elements contribute to the emergence of bullying aspects of the work environment and character of workers. while the attributes of the work environment are proven precursors of bullying, research on personality as precursors of bullying remains unclear. the thesis explores the association between five aspects of personality (extraversion, openness to experience, neuroticism, agreeableness and conscientiousness) and the vulnerability to abuse in workplaces, focusing on the principle of victim precipitation. however, research indicates mixed results surrounding associations between the other five attributes and bullying at work. the research was undertaken by a combined number of 165 full-time pakistani administrators from bahawalpur pakistan organization. the findings indicate a negative association with workplace bullying between extraversion, openness to experience, agreeableness and conscientiousness. neuroticism on the other hand shows positive connection with bullying at work. in this thesis researcher has also examine the moderating role of work environment between workplace bullying and extraversion, openness to experience, neuroticism, agreeableness and conscientiousness. this thesis also discusses the contribution/implication of the theory and practices. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: sumerarana60@gmail.com doi: https://doi.org/10.52461/sabas.v1i2.440 introduction bullying exploitation in the work environment is a developing worldwide issue. workplaces bullying increases the casualty's employment, ailment, non-attendance, insecurity, aim to leave the work, and evasion from social business related cycles, and diminishes their prosperity, work fulfillment, work commitment and confidence (nielsen & einarsen, 2012, 2018). therefore, a comprehension of both the use of harassing strategies and workplaces bullying exploitation is a significant critical issue in the field of research. human resources faculty and managers in general https://journals.iub.edu.pk/index.php/sabas mailto:sumerarana60@gmail.com https://doi.org/10.52461/sabas.v1i2.440 south asian review of business and administrative studies vol. 1, no. 2, december 2019 112 the survivors of workplaces bullying explicitly needed to help them all the almost certain understand who the harassers are. a significant issue that firms are presently facing in general is the existence of bullying amongst workers. workplaces bullying known as a type of personal offense/abuse, that contains kept devaluing or hazardous practices concerns in any event at least one or more worker (shields & wilkins, 2009), that are genuinely unpretentious (e.g., unnecessary remaining burdens, tireless work monitoring, individual jokes, tattle) to express and recognizable (abuses, dangers, and so forth). bullying is a genuine psychosocial occupational hazard and is accounted for to happen consistently in workplaces, with a commonness assessed at 11–18 percent. even more alarmingly, reports and outlines demonstrate that the repeat of bullying at workplaces has expanded lately 27 percent, (workplaces bullying institute, 2014). relationship between specific personality traits and workplace bullying may not be direct and this statement needs to be challenged theoretically and observationally. future inquiry between personality traits and workplace might discover the rounded link between personality traits and workplace bullying (a.-k. samnani & singh, 2012). for instance, workers might be bound to meet bullying at workplaces at lower and significant degrees of appropriateness, however, note at middle level. moderators and mediators ought to likewise be analyzed the association of personality and bullying as research propose that moderators and mediators assist us with bettering comprehend the uncertain idea of the connection between constructs. examination need to embrace an individual-climate viewpoint and completely inspect the association of individual and workplace factors, (for example, organizational climate) as predecessor of workplace bullying. by utilizing an individual circumstance interactionism standards, workers character could likewise fill in as a border conditions to impact worker insight and response towards working environment harassing (a. k. samnani & singh, 2016). workplace bullying has discovered in modern research as profoundly predominant miracle in subcontinent and arising countries for example pakistan (majeed & naseer, 2019). nurses are found amongst the most hassled workers in sub continental countries for example pakistan in light of their tendency of work and long hours of working in health sector. it is stated that nurses employing in pakistan sparkles adverse feelings of bullying at work that can overflow from work to the family spaces inducing personal rudeness. additionally, a couple of current examinations have featured that nurses in pakistan are more helpless against occurrence of bullying and are more likely to witness bullying at works as criticism, annoying or defamatory conduct and it has become a core issues tormenting each profession and organization internationally with unrealistic ramifications for its casualties. especially the sector like health care in an emerging nation like pakistan grips huge significance for analyzing how and when nurses insight of workplaces bullying may trigger degenerate work practices. the objective of the existent study was to test the moderation model in health area of pakistan by applying the victim perception theory, we have directed research of the effect of the personality trait (extraversion, conscientiousness, agreeableness, openness, neuroticism) through of work climate on workplaces bullying. the causal connection between individual characteristics and bullying might be multifold (nielsen & einarsen, 2018). however, we may likewise hypothetically anticipate a forward causation, whereby individuals low in personality traits may confront amore bullying over the long period of time, since they either seem to be obvious objectives or can't adapt to and stop the undesirable treatment. an endless loop of occasions may likewise create among bullying and changes in close to home strength, in that individuals low in personality traits may face all the more bullying, which again may lessen their degrees of toughness, making them significantly more inclined to being. literature development victim precipitation theory south asian review of business and administrative studies vol. 1, no. 2, december 2019 113 victimization is the procedure of becoming victimized or becoming a victim. the term victim of crime generally refers to some individual, entity, or group that has suffered harm or loss because of an illegal action (hussin & zawawi, 2012). researchers have stated that human personality behaviors or personalities are a vital portion of describing why exploitation/ misuse happen in work (henle & gross, 2014a). this could be defensible on the grounds of the victim precipitation concept/theory (aquino & lamertz, 2004), which indicates that certain workers are extra prone to exploitation in the office than many others due to the behavior traits they display i.e. proactive victims and obedient victims. it is explored the role of negative effect, which quantifies a worker's overall propensity to encounter negative feelings, for example, dread and tension, as an individual trademark that inspires oppressive practices from others. provoking victims denote to people who pay to their own victimization by demonstrating some psychological or behavioral trends (e.g., irritation, and produce stress and conflict, destructions of social standards, adapting or generating behavior) that provoke violence from other people. victim provocation includes the victims acting in a fashion that leads to victimization. while submissive or passive victims discuss the people who become so since they pose themselves as a simple or susceptible goal due to their personalities such as flaws in their character like non self-esteem or are more reflexive, nonaggressive, anxious, uncertain, and informally quiet, unassertive and nervous (aquino & lamertz, 2004) . victims may be designated due to their character as the bully spots flaws within the victim's character, such as an absence of social services, a propensity to evade battle, and an incapability to manage differently, the victim could aggravate hostile behavior inside a bully (einarsen, raknes, & matthiesen, 1994). for the current research, we'll inflate the sufferer precipitation concept by depiction the big five classification to determine character personalities that are suggestive of submissive and provocative sufferers. fig. 1: research model of personality traits and workplace bullying; with a moderating role of work climate extraversion extraversion concerns to ones favored amount and strength of social interaction (pervin, 1993), in other words, an individual's taste towards openness, fluency, and passion searching (dunn, 2000). extravert individuals are subject to knowledge optimistic feelings. indication also proposes that extraverts contribute extra in societal dealings and devote additional time in shared circumstances than do introverts and, owing to their societal ability, are most probable to catch interactive south asian review of business and administrative studies vol. 1, no. 2, december 2019 114 connections more worthwhile (watson & clark, 1997). back in meta-analyses, extraversion has been established to be linked to particular well-being, advanced job satisfaction but distinct to organizational and interpersonal deviation. the goal behavior tool, a connection between extraversion and aggravation might be multifold. on the one hand, it can be claimed that exceptionally extravert persons require attention and a propensity to control, sets and conversation something that may aggravate coworkers and thereby prompt violent behavior h1: there is a negative relation between extraversion and exposure to workplace bullying. conscientiousness conscientiousness is the person's level of association, steadiness, and motivation in objective organized behavior (mccrae & costa, 1991), and identifies with the "resistor of motivations". people scoring high on this measurement will in general be outdated, coordinated, and reliable (pervin, 1993). meta-analysis discoveries display an unmistakable positive connection among conscientiousness and employment fulfillment, while solid adverse affiliations have been set up with respect to social and structural abnormality. as to introduction to harassment, asserted, based on scientific work with genuine instances of harassing, that numerous objectives will in general be excessively reliable and coordinated, which both are qualities of high conscientiousness. in light of both the target conduct and negative discernment components little stages of conscientiousness may possible be connected with exposure to harassing. for example, workers who don't convey their work on schedule or on the other hand who doesn’t act in accordance with expected guidelines will most likely be exposed to nearer checking by leaders. on the off chance that these employees see this checking as ill-conceived, out of line and precise, they may see and understand it as certain type of provocation or harassment. h2: there is a negative relation between conscientiousness and exposure to workplace harassment. agreeableness agreeableness alludes to the degree that an individual or employee is amiable, understanding, and conciliatory (cervone & pervin, 2015). it is found that people who are high in agreeableness experience more certain effect and, for the most part, have more significant levels of well-being. discoveries demonstrating that higher levels of agreeableness are identified with higher employment fulfillment, while being contrarily connected with relational and authoritative deviation, accordingly recommending that people with high characteristic experience on a general positive work circumstance, people with a low score might be all the more effortlessly associated with provocation. with respect to the target performance mechanism, folks who are low in agreeableness are reportedly distrustful and uncertain (mccrae & costa, 1987). in the light of a negative discernments instrument, this question in others may likewise make them realize the cases of workplace badgering in any event, when scarcely exist. an undesirable connection among provocation and cordiality can be possible through the reversed causality system. that is, as orderly and on-going provocation is an extraordinary societal stress, the situation is very conceivable that an objective turns out to be considerably more distrustful and hesitant toward others after expose to harassment. in use together the hypothetical systems appear to highlight adverse connection among agreeableness and harassment. h3: agreeableness shows negative relation with experience to workplace harassment. openness openness denotes to an person's concern in culture and the partiality for innovative actions, skills, and passions, and is linked to methodical and imaginative creativity, conflicting philosophy, and political broad-mindedness. individuals who notch lower on honesty are inclined to be traditional and conformist in their viewpoint and conduct and favor acquainted procedures to new adventures, south asian review of business and administrative studies vol. 1, no. 2, december 2019 115 and usually have a wider selection of welfares. but as it’s probable that vulnerability to harassment can make workers more reticent in societal circumstances and so draw from connections it is probable that harassment affect the willingness attribute via retreated mechanism in which bullying contributes to reduced levels of openness to new adventures. this type of retreated association between the factors has been shown in the hitherto defined research by nielsen & knardahl, (2015) because vulnerability to bullying at standard was linked with a substantial decline in notches on willingness a couple of decades later. openness to encounter depicts 'the broadness, perceptiveness, ingenuity, and intricacy of a individual's emotional and empirical life. this attribute exhibit whether someone is independent or creative and portrays a individual taste for an assortment of tasks over a rigorous monotonous. individuals who notch low on transparency will in general be customary, conventional in their viewpoint and conduct, and favor natural schedules to new encounters, and by and large have a smaller scope of interests. receptiveness mirrors an adaptable, innovative and mentally inquisitive methodology in managing upsetting circumstances (watson & hubbard, 1996b), also it's been contended that men with elevated notches on this attribute, evaluate circumstances as less hostile when related with men with low scores. h4: openness is negatively related to exposure to workplace bullying. neuroticism neuroticism alludes to change versus enthusiastic insecurity and focuses to whether an individual will in general be loose and steady, or restless and effortlessly furious. people with higher notches on this characteristic are described by sensations of anxiety, stressing, and uncertainty. metainvestigations display that neuroticism is adversely identified with work fulfillment and absolutely identified with relational and authoritative deviation. concerning harassment, neuroticism and the connected develop negative affectivity, has been discovered to be definitely identified with harassment in both meta-investigations (bowling & beehr, 2006) and future examinations. in light of their basically critical environment, neurotic people involvement more adverse lifecycle occasions than do other individuals. henceforth, subsequent the target conduct and the undesirable discernments instruments, it is sensible that they moreover have a serious threat of being uncovered to, just as seeing, work harassment. (mccrae & costa, 1991) however, because of the horrendous idea of presentation to workplace harassment, it is likewise conceivable that individuals become extra apprehensive and shaky as a result of delayed experience to provocation, along these lines proposing a reversed causality relationship, where harassment reasons change in the character of the objectives. to decide if the normal relationship between neuroticism and exposure to harassment remains accurate, the accompanying theory will be tried: h5: there is a positive relation exist between neuroticism and exposure to workplace harassment. work climate there have been not many endeavors to analyze (a.-k. samnani & singh, 2016) the part of the work atmosphere in encouraging (or diminishing) tormenting conduct. the exertion atmosphere/climate may assume a significant part in clarifying the clashing discoveries in the literature. we center around two work atmosphere/climate categories. to begin with, the work atmosphere may speak to a help public work atmosphere for representatives. there are various psychosomatic, societal, and administration linked perspectives that may decide a helpless social work atmosphere. additional, a significant element is that there is apparent force imbalance between work environment tormenting and character qualities (einarsen et al., 2011; a.-k. samnani & singh, 2012). south asian review of business and administrative studies vol. 1, no. 2, december 2019 116 work job qualities, for example, job struggle, job vagueness, work weakness, job over-burden, task self-sufficiency, social help, and ability usage may likewise bring about expanded tormenting within the sight of a work atmosphere of force awkwardness/imbalance since representatives (a.k. samnani, 2013) who exhibit worry about their work job, for example, vulnerability about their work assignments and duties, may will in general get seen as powerless by directors and colleagues. h6: a work climate will moderate the connection between workplace bullying and personality traits. methodology procedure this study considered the relationship among employees of hospitals workplace bullying, personality traits and work climate. data were collected from private and government hospitals of nurses. management of hospitals was informed via electronic mail and personally. before the surveys were coursed, the researcher met with hr administrators to explain the plan of the investigation. the significance of the study and the objectives to be met are additionally talked about with hr managers. the medical clinic administrators were educated that the essential explanation regarding the study was to assemble employee’s opinions, perceptions and beliefs. the questionnaires were straightforwardly given to administrators by the researchers. employees were given an envelope and an introductory letter that guarantees the protection of review just as a bring parcel back. respondents were approached to present the questionnaire to their supervisor from where the researcher gathered them after one and half week. the questionnaire comprises of identification code of employees for the reason that data collected from the nurses can be linked and combined for investigation. a specific identification code has been assigned to each employee. the questionnaire having, measures of workplace bullying, personality traits and work climate were distributed to 200 nurses of hospitals. the nurses recorded their responses about workplace bullying, personality traits, and work climate. the researcher distributed 200 questionnaires out of which 165 were given back for employees, so 35 were never returned. so, the overall response rate of the respondents was 82%. the average span of control for every supervisor was eight to ten nurses. research design the current study employed a quantitative technique with a cross sectional approach (albassami, hameed, naveed, & moshfegyan, 2019; hameed & naveed, 2019; hamid, shahid, hameed, amin, & mehmood, 2019; ul-hameed, mohammad, shahar, aljumah, & azizan, 2019). the contributor appropriate current inspection will be accumulation of registered nurses employed in government, private and voluntary population of bahawalpur hospitals. current quantitative investigation evidence is assembling cross section-ally over histrionic adoption like questionnaire. non probability sampling approach, convenience sampling is recycled in the process of course directed toward build up sample going for nurses in the character of impressive survey demands conscious report including departmental knowledge. well liked conformity along the present sampling practice 20 to 25 questionnaires were disposed all 20 introductory prisoners which was draftee wound up own touch of researcher. expressive introductory prisoner has circulated questionnaires furthermore envelopes directed towards their companion at organization. questionnaires have been returned to researcher through the introductory prisoners. population individuals or organizations having homogeneous attributes form a group which is further named as population of study. total number of respondents involved in the study was 165, who were working in the government and private hospitals of bahawalpur. notable hospitals in the study were bahawalpur victoria hospital, benno cancer hospital, combined military hospital and iqbal hospital bahawalpur. furthermore, gender of respondents was concerned 132 were females 80% of total sample and 33 were male which are 20% of total sample size. the purpose was to check south asian review of business and administrative studies vol. 1, no. 2, december 2019 117 the relationship between workplace bullying and personality traits while considering the work climate as a moderator. table. 1population and sampling name of hospitals number of respondents bahawalpur victoria hospital 105 benno cancer hospital 23 combined military hospital bahawalpur 20 iqbal hospital bahawalpur 17 total 165 sampling technique in survey methodology sampling is considered a subset of individuals from population to estimate or determine the characteristics of whole population because it was not possible to gather information from whole population due to scarcity of time and other resources. in order to ensure reliability of sample chosen for data collection, it is significant cant to focus on sampling design and technique. it includes ways through which sample is selected for ensuring its reliability and true representation of population. regarding the present study, the researcher used convenience sampling approach (a type of non-probability sampling). the researcher has used non-probability convenience sampling because of the limitations in availability of the participants, their busy schedule, privacy concerns and time constraints. while, in convenience sampling, a sample of units or people is obtained, who are most conveniently available, putting it another way, it is collection of information from members of the population who are conveniently available to provide it. it is best to obtain some “quick” information to get a feel for the phenomenon or variables of interest (sekaran & bougie, 2016). to collect data questionnaires were circulated among nurses from private and government hospitals of bahawalpur. different types of testing reliability are used. mostly in spss reliability test has been use to test the scales validity. reliability test has been used through cronbach’s alphas coefficient (sekaran & bougie, 2016). according to nunnally, (1978), the value of the cronbach’s alpha should be greater than 0.7 which is acceptable. it is estimating the internal consistency, which shows that how items are related between each other as a group. this considered the reliability of the scale. to test the reliability test in spss v.23, the values show more acceptable range considering 0.71 to 0.96. the values which show the result more than 0.6 it is considered to be in the average range, while greater than 0.70 or higher show the values are more within better range of the reliability test. table 3.6 shows the alpha’s value of all constructs which are used in this study. the reliability of the dependent variable show the value to 0.878 which is close to 0.9 is more acceptable as described by. the scale of the independent variable like personality traits is showing the cronbach ‘alpha value for extraversion to 0.833 which is good, conscientiousness is 0.702, agreeableness is 0.723, openness is 0.712, neuroticism is to 0.960, all the values are more than 0.7 so all are acceptable and good. work climate the value of alpha is 0.761. table 2 reliability test south asian review of business and administrative studies vol. 1, no. 2, december 2019 118 constructs number of items cronbach's alpha workplace bullying 7 0.878 extraversion 4 0.833 conscientiousness 4 0.702 agreeableness 4 0.723 openness 4 0.712 neuroticism 4 0.960 work climate 6 0.761 total 33 descriptive statistics enable us to manage large data in practical manner (mcdowall & saunders, 2010).the mean value explains the central tendency of responses, shows where the average response falls while the standard deviation let us understand deviation from average point. for workplace bullying mean value is 2.4 which indicate that majority of response is towards “now and then”. extraversion, conscientiousness and agreeableness have mean value approximately 2.7, 2.5 and 2.5 respectively which indicates that majority of response is toward disagree, and for openness and neuroticism it is 3.2 and 3.0 indicating that major response is toward neutral. the work climate mean value is 2.6 which indicate that most of the respondents are towards disagreeing. the standard deviation tells us how many responses deviate from mean value. when there is high deviation it indicates outliers are present in the data. the standard deviation value must be less than 1; all the variables have standard deviation value less than 1 and falls between 0.72-0.95. data analysis correlation table 4.4 displays workplace bullying and extraversion has a correlation of 0.560 which signifies positive and strong correlation. this means increase in workplace bullying also increases extraversion personality trait. the value among workplace bullying and conscientiousness is 0.859 which indicates correlation is positive and strong. this means when workplace bullying increases then conscientiousness will also increase. workplace bullying and agreeableness shows a correlation value of 0.898 that is positive and strong. this means when workplace bullying increases then agreeableness personality trait will also increase. the value of correlation linking workplace bullying and openness is 0.461 which means a positive and moderate correlation value. this means increase in workplace bullying also increases openness personality trait. workplace bullying and neuroticism shows a correlation value of 0.446 that is positive and moderate, it explains that higher level of workplace bullying will lead to increased neuroticism personality trait. the value of correlation linking workplace bullying and work climate is 0.838 which means a positive and strong correlation value. the p-value is significance value, if it is less than or equal to 0.01, then the hypothesis is accepted at 1% which means there is 1% chance of error in results whereas if p-value is less or equal to 0.05 south asian review of business and administrative studies vol. 1, no. 2, december 2019 119 then it means there is 5% chance of error in results. the table 4.4 indicates that all the values of correlation are significant at 1% chance of error. table 4.4 correlation analysis variables 1 2 3 4 5 6 7 workplace bullying 1 extraversion 0.560** 1 conscientiousness 0.859** 0.520** 1 agreeableness 0.898** 0.559** 0.946** 1 openness 0.461** 0.426** 0.395** 0.405** 1 neuroticism 0.446** 0.381** 0.369** 0.391** 0.812** 1 work climate 0.838** 0.531** 0.903** 0.888** 0.408** 0.404** *correlation is significant at the 0.05 level (2-tailed) **correlation is significant at the 0.01 level (2-tailed) regression analysis the association between variables that actually exists is determined by regression analysis. the quantitative method for measuring the association between variables was introduced by altman & krzywinski, (2015) and named the process as regression number of methods used to evaluate the association among variables. to anticipate the relationship between variables correlation is not enough. correlation shows the true association between the variables, up to which extent one variable relies on another. there is no multi-colinearity as demonstrated by the findings of the correlation study that the coefficients of correlation were smaller than 1. table 4 regression analysis of workplace bullying and personality traits predictor b r2 adjusted r2 significance personality traits 0.810 0.656 0 .654 .000 the results are listed out in table 4.5. it shows the model summary which is actually r2, adjusted r2 and beta. the b co-efficient shows the per unit change in one variable which is caused by another variable. the r2 shows the change in dependent variable which is caused by independent variable. newly updated form of r2 is defined as modified r2 and is optimized for the number of predictors inside the model. in this research r2 is 0.656 this signify about 65% variations in the workplace bullying is explained by personality traits. the significance value shows that a personality trait is significantly associated to workplace bullying. table 4.6 regression analyses of personality traits and work climate predictor b r2 adjusted r2 significance work climate 0.785 0.616 0 .614 .000 south asian review of business and administrative studies vol. 1, no. 2, december 2019 120 from the results of regression analysis it is concluded personality traits has a positive and significant association with work climate where the value of b is 0.785 and it demonstrate one unit change in personality traits and work climate will be increased by 78%. the value of r2 shows 61% variation in personality traits caused by work climate. the value of significance also reveals both variables have positive and significant association. table 4.7 regression analysis of workplace bullying and work climate predictor b r2 adjusted r2 significance work climate 0.838 0.703 0 .701 .000 the table 4.7 shows individuals perceptions was positively associated with workplace bullying at the significance level of p=0.000. this association was clearly described by the results of the study where b is 0.838 and explains if there is one unit change in work climate than workplace bullying will be increased by 83%. r2 value shows 70% variation in workplace bullying caused due to work climate. testing theoretical relationships the process of regression is conducted by numerous methods i.e. baron kenny, (1986) however in this study hayes (2008) method is used to carry out analysis due to its appropriateness. the approach is obsolete as it applies a requirement of complete influence of moderation causation although, from the view point of some researchers, it is not required, and even a barrier to measure the true impact (preacher & hayes, 2008). according to these researchers, even if no hints of direct influence are identified between the predictor and outcome variable, the indirect impact through moderation is also probable. furthermore, because social sciences data is often troublesome due to the circumstances, structure and background of respondents, the bootstrapping strategy for moderation in hayes (2008) method improves the probability of reliable outcomes as the sample is separated into several tiny bits and pieces and analysis are carried out on smaller sub-samples. moderation analysis by using model 1 the moderating role of work climate between personality traits and workplace bullying was analyzed. it has been concluded from table 4.8 that work climate act as moderator between extraversion and work-place bullying as the p value is smaller than 0.05 and the value of p=0.00 is indicating a significant value. the value of t is 2.88 which is greater than 1.9. the lower and upper limit is 0.04 and 0.20 respectively and contains same signs which shows zero does not present between them and this leads to the acceptance of hypothesis. hence ha i.e. a work climate moderate the relationship between extraversion and work-place bullying. table 4.8: moderation analysis results for work climate on relationship of extraversion and workplace bullying. variables b se t p ll 95% ul 95% extraversion*work climate! workplace bullying 0.12 0.04 2.88 0.00 0.04 0.20 south asian review of business and administrative studies vol. 1, no. 2, december 2019 121 fig 4.3: scatter-plot graph for extraversion and work-place bullying in the presence of work climate fig 4.3 shows that, extraversion is on x-axis and workplace bullying on y-axis. work climate is a moderator and the value of blue interpolation line (i.e. 1.67) which represents low level of work climate. in the graph the value of green interpolation line (i.e. 2.50) which represents moderate level of work climate. and interpolation line brown (i.e. 3.50) in the graph representing high level of work climate. table 4.9: moderation analysis results for work climate on relationship of conscientiousness and work-place bullying. variables b se t p ll 95% ul 95% conscientiousness*work climate! workplace bullying 0.10 0.04 2.50 0.01 0.02 0.18 fig 4.4: scatter-plot graph for conscientiousness and work-place bullying in the presence of work climate table 4.9 shows that work climate act as moderator between conscientiousness and work-place bullying as the p value is smaller than 0.05 and the value of p=0.01 is indicating a significant value. the value of t is 2.50 which is greater than 1.9. the lower and upper limit is 0.02 and 0.18 respectively and contains same signs which shows zero does not present between them south asian review of business and administrative studies vol. 1, no. 2, december 2019 122 and this leads to the acceptance of hypothesis. hence ha i.e. a work climate moderate the relationship between conscientiousness and work-place bullying. in the fig 4.4 blue, green and brown lines represents low, moderate and high level of work climate respectively. table 4.10: moderation analysis results for work climate on relationship of agreeableness and work-place bullying. variables b se t p ll 95% ul 95% agreeableness*work climate! workplace bullying 0.10 0.04 2.71 0.01 0.03 0.17 fig 4.5: scatter-plot graph for agreeableness and work-place bullying in the presence of work climate it has been concluded from table 4.10 that work climate act as moderator between agreeableness and work-place bullying as the p value is smaller than 0.05 and the value of p=0.01 is indicating a significant value. the value of t is 2.71 which is greater than 1.9. the lower and upper limit is 0.03 and 0.17 respectively and contains same signs which shows zero does not present between them and this leads to the acceptance of hypothesis. hence ha i.e. a work climate moderate the relationship between agreeableness and work-place bullying. in the fig 4.5 blue, green and brown lines represents low, moderate and high level of work climate respectively. table 4.11: moderation analysis results for work climate on relationship of openness and workplace bullying. variables b se t p ll 95% ul 95% openness*work-climate! workplace bullying 0.11 0.05 2.14 0.03 0.01 0.21 fig 4.6: scatter-plot graph for openness and work-place bullying in the presence of work climate south asian review of business and administrative studies vol. 1, no. 2, december 2019 123 table 4.11 summarized the result that work climate act as moderator between openness and workplace bullying as the p value is smaller than 0.05 and the value of p=0.03 is indicating a significant value. the value of t is 2.14 which is greater than 1.9. the lower and upper limit is 0.01 and 0.21 respectively and contains same signs which shows zero does not present between them and this leads to the acceptance of hypothesis. hence ha i.e. a work climate moderate the relationship between openness and work-place bullying. in the fig 4.6 blue, green and brown lines represents low, moderate and high level of work climate respectively. table 4.12: moderation analysis results for work climate on relationship of neuroticism and workplace bullying. variables b se t p ll 95% ul 95% neuroticism*work-climate! workplace bullying 0.12 0.04 2.42 0.02 0.02 0.16 fig 4.7: scatter-plot graph for neuroticism and work-place bullying in the presence of work climate it has been concluded from table 4.12 that work climate act as moderator between neuroticism and work-place bullying as the p value is smaller than 0.05 and the value of p=0.02 is indicating a south asian review of business and administrative studies vol. 1, no. 2, december 2019 124 significant value. the value of t is 2.42 which is greater than 1.9. the lower and upper limit is 0.02 and 0.16 respectively and contains same signs which shows zero does not present between them and this leads to the acceptance of hypothesis. hence ha i.e. a work climate moderate the relationship between neuroticism and work-place bullying. in the fig 4.7 blue, green and brown lines represents low, moderate and high level of work climate respectively. 4.5 summary of accepted/rejected hypothesis table 4.13 given below show the summarized results of the hypotheses under this study. hypothesis statement results h1 there is a negative relation between extraversion and exposure to workplace bullying. accepted h2 there is a negative relation between conscientiousness and exposure to workplace harassment. accepted h3 agreeableness shows negative relation with exposure to workplace harassment. accepted h4 openness is negatively related to exposure to workplace bullying. accepted h5 there is a positive relation exist between neuroticism and exposure to workplace harassment. accepted h6 a work climate will moderate the relationship between workplace bullying and personality traits. accepted conclusion the study found that cumulative sensitivity to bullying behavior, which favored a reverted causal process, projected less toughness in the nurses. a weaker impact has been observed in the direction opposite endorsing the process for the forward cause. this reinforces the belief that the association between harassment and personality can be multiplied and, to a degree, forms a viscous circle. in addition to earlier data, bullying should also be remembered that exposure to bullying actions in the workplace tends to affect psychological robustness and also in professional healthcare workers. therefore, the vulnerability to abuse at work may not only impact the health and well-being of the affected workers but also decrease coping resources of the employees, rendering it even more sensitive to potential workplace intimidation or other difficult and demanding conditions. the results demonstrate how important it is to discourage bullying and to respond effectively when bullying appears to reduce the consequential effects. in pakistan most vulnerable and ultimate objects for bullying are healthcare nurses. our research is important and essential in this context, because it explores a specific work vulnerability mechanism which demonstrates how nurses subjected to bullying lost their resources and attempted to recover them by means of deviancy. nurses who are vulnerable to long-term bullying can demonstrate a weakening mental intensity that could reduce their capacity to resist and deal with stress. our thesis explores the moderation model and unfolds new procedures and requirements for injections of nursing in pakistani context in an asian cultural. implications of the study theoretical implications south asian review of business and administrative studies vol. 1, no. 2, december 2019 125 the objective behind this research was to investigate the connection between personality’s attributes and disclosure to workplaces bullying; moderating role of work climate. the present research contributes to the surviving workplace studies by contributing to the small number of article exploring the person level experience of abuse in workplaces. the current study has twofold theoretical implication. the first essential aspect of this work is to support personality characteristics as potential precedents to bullying in the workplaces. the essence of 'individual' by using the 'big five' as a formal context hypothesis of temperament 'has been endorsed. the outcomes uncovered that extraversion, openness to experience, agreeableness, and conscientiousness were adversely connected with bullying in the workplaces. the new critical input from the inquiry into personality and bullying, based on victims' precipitation theory, offers a strong, hypothesis for the personality-bullying relationship that has been missing from established bullying literature. these discoveries additionally give knowledge into the kinds of bullying practices. it is proposed that bullying can be isolated into two various types, specifically destructive and difference related bullying. in this regard, the victim might be harassed on the grounds that they are surveyed as effortlessly vanquished and, consequently, are obvious objectives to the predator’s aggression. clash related to bullying, then again, is incited by business related clashes which grow into a bullying circumstance. employees low in honesty, openness to experience; agreeableness and conscientiousness may include in question related bullying, while workers low in extraversion might be victims of predatory bullying. managerial implications managing bullying is considered worry for associations and people. better principles, protocols and approaches that discourage and defend workers from bullying are required. in pakistani organizations, strategies, like other anti-bullying policies around the world, should be outlined and fortified, for example, "zero-resilience bullying strategy at work" and "management with respect. “these approaches ought to incorporate an obvious obligation to bullying-free environment and a perfect explanation of nature and types of bullying practices and the standard of effects of the corporate directives not being respected. human resource professionals should already provide rules and train themselves for immediate identification and management of bullying. legitimate channels to report occurrences of working environment bullying and complaint mechanism to deal with the instances of bullying inside pakistani organizations should be framed. it is viewed that number of employees feel hesitant while registering any complaint straightforwardly about accordance of bullying due to huge societal classes differences, there should be an arrangement of proper complaint cell where people can registered their complaint against harassment. hr specialists should also work on fostering professional etiquette, friendly behaviour and empl oyee friendliness. with respect to personality-bullying relationship, research exploring the kinds of employees that are destined to become focuses of bullying can support associations to identify hazard people and engage them with the apparatuses and resources they need to stop abuse. the findings suggest that workers with poor conscientiousness, agreeableness, and extraversion and to experience are more likely to be the target of bullying in the workplaces. it is critical for managers to understand the character attributes of their subordinates and tackle them in like manner. for example, employees low in conscientiousness will in general be scattered and thoughtless; consequently, their managers ought to give clear guidelines and direction and set significances for them. appropriate and timely training and workshops for employees on self-awareness may be especially useful as it might assist them with distinguishing their shortcomings and approaches to successfully defeat them. such meetings may likewise give workers aptitudes that bring about more compelling and fitting social collaborations. this, thusly, would help in recognizing a south asian review of business and administrative studies vol. 1, no. 2, december 2019 126 potential target as opposed to holding up until the individual turns into a victim and suffer the impacts of persistent harassing. future directions and limitation while the findings of this study validated the hypothesized relationships, it is important to consider certain recognitions. firstly, cross sectional design was used, which doesn't permit the causal associations between personality and workplace bullying to be drawn. future study will seek to carry out longitudinal research studies. secondly, based on the results, we state that some features of persons potentially lead people to violence by someone else. at the same time, though, it is accepted that not only the personalities, but also the expectations of the participant (pessimistic beliefs framework) play a crucial role in evaluating how a person is a bully. it is a construct in interpretation. thus, during an evaluation of the outcomes or antecedents of bullying, human expectations should be considered. in future, individual understands regarding bullying and their personality traits should be covered. thirdly, in future investigations there could also be additional unspecified factors contributing to the bullying paradigm to further outline offender and aggressor identities. for instance, the kind of family, socioeconomic status, academic achievement, social interaction and peer recognition, depression or anxiety. fourthly, in order to further explain the nature of bullying at work, we propose that the researchers should look at the relationship between human and occupational environment variables (culture, atmosphere, leadership styles, working requirements and so on) as a backdrop to bullying at the workplace, taking the ‘interactionism theory of behavior’ from. the model of personal interactionism may also be used as a boundary state to control the understanding and response of workers to the bullying of the workplace (a. k. samnani & singh, 2016). lastly, although all the measures used are reliable and customized for the pakistani community, the information obtained by questions alone does not represent the current situation. prejudice resulting through the use of survey questions for information gathering should be taken as assumed. references albassami, a. m., hameed, w. u., naveed, r. t., & moshfegyan, m. 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(2019). coopetition-based open-innovation and innovation performance: role of trust and dependency evidence from malaysian high-tech smes. pakistan journal of commerce and social sciences, 13(1), 209-230. hamid, s. n. a., shahid, m. n., hameed, w. u., amin, m., & mehmood, s. (2019). antecedents of job stress and its impact on nurse’s job satisfaction and turnover intention in public and private hospitals of punjab pakistan. international journal of scientific & technology research, 8(10), 129-137. hussin, n., & zawawi, m. (2012). preventing criminal victimization through community education: an islamic formula. procedia-social and behavioral sciences, 68, 855-864. south asian review of business and administrative studies vol. 1, no. 2, december 2019 127 majeed, m., & naseer, s. (2019). is workplace bullying always perceived harmful? the cognitive appraisal theory of stress perspective. asia pacific journal of human resources. mccrae, r. r., & costa jr, p. t. (1991). the neo personality inventory: using the five‐factor modei in counseling. journal of counseling & development, 69(4), 367-372. mccrae, r. r., & costa, p. t. (1987). validation of the five-factor model of personality across instruments and observers. journal of personality and social psychology, 52(1), 81. nielsen, m. b., & einarsen, s. (2012). outcomes of exposure to workplace bullying: a metaanalytic review. work & stress, 26(4), 309-332. nielsen, m. b., & einarsen, s. (2012). prospective relationships between workplace sexual harassment and psychological distress. occupational medicine, 62(3), 226-228. nielsen, m. b., & einarsen, s. v. (2018). what we know, what we do not know, and what we should and could have known about workplace bullying: an overview of the literature and agenda for future research. aggression and violent behavior, 42, 71-83. nielsen, m. b., & knardahl, s. (2015). is workplace bullying related to the personality traits of victims? a two-year prospective study. work & stress, 29(2), 128-149. preacher, k. j., & hayes, a. f. (2008). asymptotic and resampling strategies for assessing and comparing indirect effects in multiple mediator models. behavior research methods, 40(3), 879-891. samnani, a. k., & singh, p. (2012). 20 years of workplace bullying research: a review of the antecedents and consequences of bullying in the workplace. aggression and violent behavior, 17(6), 581-589. sekaran, u., & bougie, r. (2016). research methods for business: a skill building approach. john wiley & sons. shields, m., & wilkins, k. (2009). factors related to on-the-job abuse of nurses by patients. health reports, 20(2), 7. ul-hameed, w., mohammad, h., shahar, h., aljumah, a., & azizan, s. (2019). the effect of integration between audit and leadership on supply chain performance: evidence from uk based supply chain companies. uncertain supply chain management, 7(2), 311-328. doi:https://doi.org/10.5267/j.uscm.2018.8.001 watson, d., & clark, l. a. (1997). extraversion and its positive emotional core. in handbook of personality psychology (pp. 767-793). academic press. watson, d., & hubbard, b. (1996). adaptational style and dispositional structure: coping in the context of the five‐factor model. journal of personality, 64(4), 737-774. https://doi.org/10.5267/j.uscm.2018.8.001 south asian review of business and administrative studies vol. 2, no. 1, june 2020 1 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas effect of covid-19 pandemic on women entrepreneurial sustainability and post-pandemic opportunities sunbul naeem, national defense university, pakistan article details abstract history revised format: may 2020 available online: june 2020 keywords covid-19, post-pandemic opportunities women entrepreneurs the women entrepreneurs are important pillars of any economy. without the active participant of the women’ entrepreneurs we cannot be economically established in the recent crisis of the covid-19. the governments of the world can promote the valor of the entrepreneurship among the women by adopting following recommendation. first each government should reshuffle their policies and introduced these policies in which a gender equality programs will be promoted. every government should take an initiative to conduct the training to the young women with providing a stipend to each participant during these trainings. while providing the training to these women these governments should establish the women incubation business centers in these centers they provide such kind of the skills to these women which not only promote their confidence level among these participants but also promote their inner ability of the creativeness. the government should launch such rehabilitation programs for those women entrepreneurs who’ business are badly affect during this crisis, to provide them another business opportunity to re-established their business from grass-root level. for those women wo are interested to starts a new venture also provide them logistic and financial support for them and also provide the unique business ideas to these interested females-entrepreneurs as well. to financing the new project, the government should provide these finances to these women without any complicated procedures. they should provide the required funding’s to these women at their home steps. for the training purpose to these women the government should take the help from different expertise and ngo’s. it is necessary for all of us that we should learn lesson from this crisis and it is also very necessary that we should take drastic steps to promote the innovative skills among the young entrepreneurs of our society. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: sunbulnaeemcheema@gmail.com doi: https://doi.org/10.52461/sabas.v2i1.439 https://journals.iub.edu.pk/index.php/sabas mailto:sunbulnaeemcheema@gmail.com https://doi.org/10.52461/sabas.v2i1.439 south asian review of business and administrative studies vol. 2, no. 1, june 2020 2 introduction the covid-19 or in the simplest word called the corona virus, actually creates the severe respiratory infection in human body (cheng, wang, & wang, 2020). the covid-19 belongs to the corona virus family and having a novel nature of virus, so the proper treatment of this virus is not possible so far (robson, 2020; y.-c. wu, chen, & chan, 2020; zhang et al., 2020). the first case in humans of this covid-19 had been appeared in late 2019 in the wuhan city of the china (du et al., 2020). within the seven months of after reporting the first case of corona epidemic in human, this epidemic disease had been spread very rapidly in all around the world. now at the time of preparing this manuscript, approximately 188 countries, 7.69 million cases and more than 426000 casualties have been reported because of the covid-19 epidemic (organization, 2020). as far as the covid-19 has a unique virus and having different characteristics there is not suitable vaccines or other proper medication has been prepared to dis-effective the covid-19 in human bodies so far (cheng et al., 2020; mccloskey & heymann, 2020). the resultantly, the only way to prevent this epidemic virus from rapidly spread among the humans are to follow the prescribed recommendations of who or cdc. according to these recommendations the people should avoid to go to the public gatherings, and observing the social distancing from each other’s etc. (organization, 2020; z. wu & mcgoogan, 2020). therefore to follow these recommendations of the who, in march 2020, all countries of the world had been observed the strict lockdown situation in every region of the world (coibion, gorodnichenko, & weber, 2020; inoue & todo, 2020). in the consequences of these lock downs, the wheel of the economy had been totally chocked up (coibion et al., 2020). because of these lockdowns biggest organizations of the world like ibm. and others biggest names of the world organization were facing the huge financial losses and the ceos of these companies now have decided to layoff one third their employees in order to survive in this crisis and also reduced the other extra cost (fernandes, 2020; mogaji, 2020). the human history has been full of the different natures of the crises (shaluf & said, 2003). these crises can be divided in four categories (cho & gower, 2006). the first is the financial recession (aiyar, 2012; nayyar, 2011), the second is the natural catastrophe (runyan, 2006), like katrina disaster (niman, 2005), earth quake, and the third are human made crisis like the london riots(doern, 2016) and last one is epidemic like dengue, ebola now corona etc. (bhalekar, 2020). these crisis have impacted the economy of the whole world simultaneously as the world’ economy has been affected by the covid-19 unanimously (fernandes, 2020). the evidence of different studies have showed that the new start-ups or the entrepreneurs always play a key role to sustained or provided a strong pushups to the economy during or after these crisis (devece, perisortiz, & rueda-armengot, 2016; klapper, meunier, & diniz, 2014). every previous crisis are not only given up the different business-opportunities but these crisis always provided the new business-opportunities as well (eggers, 2020). dahles and susilowati (2015) suggests that the humans have to learn that lesson from these crisis that every crisis is not always bad omen for the business but these crisis also provided the ample novel business opportunities as well. during these crisis the biggest tycoons or the business firms always collapse. bullough and renko (2013) found that the important reason of the failure of these bigger companies was their lack of innovations and inadaptability with these changing environments as compare to that of the entrepreneurs. the term entrepreneur basically belongs to the french lexical and this concept is very old one and the origin of this term has been found in the sixteenth century (herrington, kew, kew, & monitor, 2010). south asian review of business and administrative studies vol. 2, no. 1, june 2020 3 the entrepreneurs always deal with new business opportunities, provide new startups with innovating ideas and also offer the lot of employment opportunities to the public in large(low & macmillan, 1988; stevenson, roberts, & grousbeck, 1985). the one of these benefits of entrepreneurs are that they can starts their business in acute shortage of the physical and financial resources (bickenbach, bode, dohse, hanley, & schweickert, 2009; dahles & susilowati, 2015). so in this acute situation of the uncertainty when the whole world is strangled with this epidemic disease of corona and major organizations and business are on the verge of closing their operations permanently, the entrepreneurs specially the female entrepreneurs will play a key role to sustain and having different opportunities after this covid-19 crisis. saeed, malik, sohail, tabassum, and anwar (2014) found that the female entrepreneurs are very noticeable characters of any economics. previous studies of the western and far east countries on females entrepreneurship indicate that the female entrepreneurs play a key role in cultural and economic crisis to revitalize the new blood in the dead economy (de vita, mari, & poggesi, 2014; yu, 2011). but during the covid-19 crisis, the little efforts have been shown to encourage the female entrepreneurs to sustain in this epidemic that have been badly affected during this natural crisis. hence in order to survive in this crisis it is very imperative to promote the entrepreneurships cultures among the females specially and support the females’ entrepreneurship activities after this epidemic crisis. significance of the study previous researchers have studied the different characteristics of the entrepreneurship behavior or entrepreneurial sustainability and opportunities during the different crisis. these crisis have been impacted the world economy in the small scale or the specific region or a country in the world. like the (doern, 2016) studied the entrepreneurship activities during the london riots, whereas the (runyan, 2006) explored the different characteristics of the entrepreneurial sustainability and different entrepreneurial opportunities during the katrina hurricane crisis. the aiyar (2012); nayyar (2011) explore the different start-ups or sme during the different financial recession. hence all of these studies had been indicated that there is no significant studies have been conducted during or after the covid19 epidemic crisis on the female entrepreneurial sustainability and opportunities. hence this study will be tried to address this gap. furthermore, the findings of this study will be helpful not only for the policy makers but also for those females’ entrepreneurs who wants to stars their own business as well and how these female entrepreneurs promote their business during and after this covid-19 epidemic and what types of opportunities which will be available for them. because young and educated women will be play an important role to rehabilitate the economics after this covid-19 episode. literature review the opportunity can be explained as how to start new business or venture to provide a better and superior services or products to their clients in the world of uncertainty and deficiencies (alvarez & barney, 2008, 2010). alvarez and barney (2007) had been established that opportunities and entrepreneurship are always interlinked to each other. in the present situation of the covid-19 has been disturbed the whole perfection of the marketing concepts providing great opportunities for the entrepreneurs to fill up this gap (açikgöz & günay, 2020; kuckertz et al., 2020). as it is one strict recommendations of the who that the people will be observing the social distancing to each other these recommendations in itself also provide the different opportunities for the female’s entrepreneurs (grube & storr, 2018; kuckertz et al., 2020). they can provide the different life savings products like the sanitizers or developed a lot medic’s social networking to deliver the lifesaving products to these people at their door steps because after this covid-19 epidemic crisis the people become more conscious for their health, furthermore these people are very reluctant to go outside without any case of exigencies (buheji & ahmed, 2020). these south asian review of business and administrative studies vol. 2, no. 1, june 2020 4 females entrepreneurs well established their brand names among their customer that will be helpful to take the competitive edge against the bigger firms even after the covid-19 epidemic. these customers will be preferred their services when female entrepreneur provide different services or products with cost effective ways (maritz, perenyi, de waal, & buck, 2020). previous studies of the (bartik et al., 2020; devece et al., 2016) showed that whenever a crisis has been come it also brings lot of unique opportunities for the sharp minds and these sharp minds well captured these opportunities in their favor and hence start a new business. alvarez and barney (2008) have been established that opportunities usually comes because of those external shocks that chock up the existing business structure and there is a need to restructure the business or the concept of the business. the new structure of business also create new demands and needs (brännström, elström, & thompson, 2001; melucci, 1980). the new demands and the needs of customers can be capture with the new and innovative business ideas. as during this covid-19 epidemic crisis of the world, the people are more conscious about their health and they demands a quality of the life products or services (buheji & ahmed, 2020; maritz et al., 2020) now hence after this epidemic crisis the female can be educate the people how these people live a healthy life this idea, also be very helpful to discovery of new opportunity in health related issues of the public in general. entrepreneurial sustainability sustainability can be defined in general sense as to human’ capacity to maintain a thing/idea or process in even uncertain circumstances(www.oxfordlearnersdictionaries.com). the process of sustainability stands on three strong basis like economy, environmental and social foundations (grant, 2020). different researchers defined the term of entrepreneurial sustainability in the different context. as hockerts and morsing (2008); schaltegger and wagner (2011) have been expounded that the sustainability is process of continuing innovation of an idea, a business or a person’ ability to create novel ideas and also having facility to nurture the innovating ideas. further expressions comprise for the entrepreneurial sustainability are: “sustaino-preneurship” (abrahamsson, 2007) further annexes to innovativeness, novelty and the entrepreneur: “qualityoriented entrepreneurship (choi & gray, 2008), “sustainability-driven entrepreneurs” (cohen, smith, & mitchell, 2008), “sustainability-focused startups” (schlange, 2009) and “unified enterprise” (schieffer & lessem, 2009). some researcher related the sustainability to the social context as called it “corporate social opportunity” (jenkins, 2009), “corporate social entrepreneurship” (hemingway, 2010) and “responsible” or “ethical” entrepreneurship (azmat & samaratunge, 2009; fuller & tian, 2006). some authors called the sustainability as the green entrepreneurship activity that is environmental friendly. green sustainability required that the entrepreneurs should be start that innovative business or idea that is positively impact their surroundings and environment (hall, daneke, & lenox, 2010) not harmful for the environment or other human beings. in the recent epidemic situation of the covid-19 the green entrepreneurial sustainability taking very importance as the majority of the public now very conscious about their environment and their health issues now as they are not aware in the past.so the green entrepreneurial sustainability will be taking most importance after the covid-19 epidemic situation. methodology the qualitative research method had been chosen for this important study. the qualitative research techniques have been appropriate for this study because of the following reasons as suggested by different researchers e.g.(bryman, 2016; cresswell, 1998). the first, in qualitative research methods the researchers use the subjective approach whereas in the quantitative method the researchers usually use the objective approach. while applying subjective approach the researcher very deeply and keenly investigate the under-studied phenomenon which cannot be possible in the objective mode of the quantitative techniques. the qualitative research is taken more importance south asian review of business and administrative studies vol. 2, no. 1, june 2020 5 as compare to the quantitative research when the study is conducted in the instable environment and needs a more detailed study of the people, culture or socio-economics condition where such uncertain environment is prevailing (dana & dana, 2005; doern, 2009). furthermore the qualitative research is more context oriented approach as compared to the quantitative approach, as the unstable environment has been created because of the covid-19 and the world’ economic has been observed its negative impact, hence this situation is very suitable to apply the qualitative research techniques rather than used the quantitative research for this study as recommended by (apostolopoulos, newbery, & gkartzios, 2019; dana & dana, 2005; fraenkel, wallen, & hyun, 1993). the interpretive philosophy has been suitable in order to study the impact of the covid-19 on the women entrepreneurial sustainability (kawamorita, salamzadeh, demiryurek, & ghajarzadeh, 2020). further examine the different kind of the business or factors that will be provided the better opportunities to the women entrepreneurs after the crisis of the covid-19. to study and explore the under investigated phenomenon the researcher had used the intensive literature review method of the qualitative method that was adopted by (baird & hill, 2020; turner & akinremi, 2020) in similar study. the largest databases like the google scholars and the google/yahoo search engines had been full up of the contents regarding the impact of the covid19 on the gender’s employment, or the challenges and opportunities creating the covid-19 to the women entrepreneurships or the post covid-19 opportunities for the women entrepreneurs had been searched out. further in these database the researcher had used the published unpublished news, reports, published and unpublished academic papers on the google scholar’s database or search engines which are discussed women entrepreneurial sustainability and opportunities during and after the different crisis also includes the covid-19 as well. the findings of these literature review had been very helpful to construct the frame work for this study and provided the valuable insights not only to comprehend this phenomenon but also provide a direction for the future researches. in this the study, the numbers of the articles, reports and news that had been reported, how the women entrepreneurial’ sustainability has been affected during the covid-19 and how converted these challenges or crisis into ample entrepreneurial’ opportunities for women after this covid-19 episode had been used specifically. findings and discussions women’ entrepreneurial sustainability and opportunities in cultural and fashion industries in europe the cultural industries contributed approximately the 6% to the domestic gdp which is almost equal to the 600 billion in euro and similar situation has been observed in almost in every region of the world (setyaningsih, rucita, hani, & rachmania, 2012).the more than 9 million women entrepreneurs designed the different kinds of the cultural related artifacts at their home or in their display centers(baird & hill, 2020). but during the lock down of the covid-19 the majority of the young women entrepreneurs who made the cultural products like the embroideries and other cultural related master-pieces, the sale of these cultural and fashion related products were reduced to almost 90% in this crisis (mcintosh, 2020; nicola et al., 2020). as the priorities of their customers shifted from these cultural expressed-products to the epidemic prevention gadgets (turner & akinremi, 2020). so during this crisis, they should make homemade innovative masks that will be express the cultural values of their countries and also make the apparels or gowns for the protection from the covid-19. hence after the covid-19 they can also make more innovative products or the services and also sale these products to their wholesalers or the end consumers by using the digitalized supply chain methods. as follow the example (banskota, healy, & goldberg, 2020) of the these cultural and fashion women entrepreneurs can developed a fascinating mobile apps to show their fashion and cultural artifacts or products to their customers south asian review of business and administrative studies vol. 2, no. 1, june 2020 6 hence after placing the order these women can easily delivered the demanded product to their customer in appropriate manners. from these app they can also use the concepts of the co-creation values added services to their customers as these customers placed their demands in that way or these customers mention their required features of the products and these women in order to fulfilled the required demand of the customers can make this product accordingly and provide the product to the customers as mentioned (corsaro, 2019). after this epidemic crisis these women can established a boutiques or display centers in order to opera-nationalize their venture in some larger scales or can established e-fashion boutiques as well. sustainability and opportunities in tourism and hospitality industry before the world’ economy badly affected by the covid-19 the more than 52% women especially in the europe has been involved in the tourism business (unwto, 2020). the tourism business has been severely affected by recent economy crisis. now this crisis also brings different more innovative trends in this industry as well (pololikashvili, 2020). these young women entrepreneurs can manage their business on the more innovative ways as these entrepreneurs can digitalize their services and provide their customer more innovative experience of the tourism and providing the travelling guidance to their clients on line as well (unwto, 2020). the digital experience may change the trend of the tourism industry (pololikashvili, 2020). these young women entrepreneurs also established their home cooking venture at their home and whenever a customer placed an order of any fast-food items or casual food these women can provide these foods articles at the door steps of their customers. as this crisis also badly impact upon the psychological system of the public in large, even during and after this epidemic virus the people are reluctant to visit to the hotels or the restaurant if these women provide the delicious home-made foods to their customer in their home then these women can promote their small scale business during or after this covid-19(bakalis et al., 2020). after the covid-19 these women will be financially in that position that these women can easily established a small innovative restaurant as well. sustainability in agribusiness and post-covid-19 opportunities katooro (2020) had trained the more than one million young villager-women entrepreneurs in the remotest areas in asia and africa pacific in order to establish their own agro-based business in these areas. the recent report of the katooro (2020) further shows that the agribusiness of the young villager’s women has been badly affected or almost at the verge of closeness because of this corona epidemic lockdowns. usually these women sold their products in nearest city but because of the restriction of the physically mobility the business of these women has been closed. so it is necessary that now a digital supply chain has been established in order to survive the business of these agro women entrepreneurs as mentioned (manivannan, kesavan, anuradha, & vetrivel, 2020). keeping in view of the training of these agro women entrepreneurs different women protection organizations have come forward to provide the training to these women regarding to use these apps and digital technologies to these women. after taking of training, how to digitalize their business theses women can be in a position that these women will establish an e-grocery and provide the agricultural related products to their customers on their demands without even physically movement (unwto, 2020). online tutorship education programs because of the lockdown as the most traditional business had been suffered badly. the education sectors related to the education academies, education institutes and the kindergarten institutes have been closed since march 2020. the mostly young women tutors are facing unemployment and south asian review of business and administrative studies vol. 2, no. 1, june 2020 7 remained constraint to their home and their student as well. so these women can providing educational and mentor training or instructions to their students from their home by using the different communication online meeting apps (huang, liu, tlili, yang, & wang, 2020). from these online tuition or providing the education services these women can earn a lot of or at least such handsome amount to support their family in this situation and these women can continue this online education services even in the normal environment. the benefits of these online education services are that these teachers can be recorded their lectures according to their flexible schedules and students can be listen these lectures when they are free and can repeat these lecture again and again in order to clear the query even in that case the query is not clear theses students can asked the question to her teachers as well (huang et al., 2020). medical service sectors during the corona epidemic, the most hospitals are remained very busy and the medical and paramedical staffs are working in the double shifted. even almost every country has been closed their hospitals during this corona virus to the general patients specially the opds of the major hospitals still remained closed (shaker et al., 2020). because of this corona virus the people are more conscious about their health related issues (turner & akinremi, 2020). so this situation also provide the tremendous opportunity for the women that they can established a tele-medicines services from their home and also make the sanitizers and other health related items from their home and supply them to their customer on their demands within reasonable price (rao et al., 2020). interruption of supply chain of main supply of physical products during the coronavirus, due to the constraints of the physical movements the inter-border transportations have been closed down totally. because of adopting this movement restriction policy by every country of the world in order to restrict the propagation of the corona virus the supply chain of the raw materials of the different products that are essential to providing the basic need to the humans has been badly affected (haleem, javaid, & vaishya, 2020). this scenario also create the opportunity for the women entrepreneurs that they can provide these raw materials to the main industry and these industry can be purchase these raw materials from these women from their home in this situation (park, kim, & roth, 2020). these women have a good opportunity to established a long lasting relationship with the main stream of supply chain and in future when the situation is in normal than these women can continually supplying these materials to the industry and therefore the whole country’ dependence on the foreign material has been lessen. women’ entrepreneurial sustainability and opportunities in beauty industry as the worst lockdown has been observed by the whole world because of covid-19 also badly impact the beauty industry of the world as well. the resultantly the more than 80% of the beauty industry or related operations to the beauty industry has been closed down(gerstell, marchessou, schmidt, & spagnuolo, 2020). the most beauty salons or parlors, were operating or having under the ownership of the women entrepreneurs has been shut down and the situation has been become more worst day by day as the most of these beauty salon now reached on the verge of the bankruptcy (balram & anand, 2020). this beauty industry has been consisted upon the different body spray, body creams, face creams, body waxes, and other face or body toiletries, the sales graph of these articles has been slugged down to 92% and as the most women’ business involved to make these mostly products in their homes, so the dropped sales of these products also affect the women’ entrepreneurial sustainability during these lockdowns(gerstell et al., 2020). the women’ entrepreneurial sustainability further affected with these lockdowns as most of the women more than 75% are operating their own beauty salons or parlor and during these lockdowns the banned on marriages ceremonies also affected their beauty related services as well. south asian review of business and administrative studies vol. 2, no. 1, june 2020 8 the main reason to slowdown of the sale of the beauty product is because that the 85% of the beauty product purchasers in the world and especially in the america the savvy beauty customers who are also called the customers of z-generation also their 75% usually visits the stores to purchase any beauty products(gerstell et al., 2020). as during the lockdown most of these stores were closed down there is big reason to reduce the sales of these beauty related products. these crisis of the beauty industry also provided the tremendous opportunities for the young women that these women can provide their beauty tips on line to their customers as these young females beauticians can established their own e-beauty salon and these young females can provide their services to their customer in very flexible times frame. the young female-entrepreneurs can established their own beauty e-mart from which these young entrepreneurs can easily provide the required beauty product to their customers on their demands without physically visiting any beauty stores. women’ entrepreneurial sustainability and opportunities in ict business sector the ict business sector of the world has not been badly affect by the covid-19 as the other business has been affected. according to the total 4% revenue of the ict business has been affected by this epidemic economics recession (meticulous market research, 2020). the ict business consists of different sectors as the online freelancer, digital marketing, mobile marketing, social marketing and other commercial or non-commercial communication apps like zoom meeting, microsoft meeting, whatsapp etc. the it experts used these apps during these social distancing scenarios of current epidemic situation very effectively and they operates these communication system from their homes and manage their business very affectively during this crisis(meticulous market research, 2020). but the women in the ict sector as compared to the males are very low and these it experts are mostly the entrepreneurs. hence these different it sectors also provide a lot of different opportunities to the women entrepreneurs to select any field of it related and these women can easily managed these business from their home in very easy and flexible way as the most of these women are more busy than men as these women also look after their families in their home these women are also balancing their dual-family career as well hence the different it sectors provide these women lot of different opportunities that these women can manage these business from their home within economical finances and earn a lot of money from their home and not only support their family and herself but also their countries as well. providing the opportunities and promote their visual and innovative skills in different field, the confidence level of these women also be enhance and their nature to remain submissive in this male dominant society also be lessen in this way of promoting the females in every business of economy. figure-1 the proposed framework of the research south asian review of business and administrative studies vol. 2, no. 1, june 2020 9 conclusion the women entrepreneurs are important pillars of any economy. without the active participant of the women’ entrepreneurs we cannot be economically established in the recent crisis of the covid-19. the governments of the world can promote the valor of the entrepreneurship among the women by adopting following recommendation. first each government should be reshuffle their policies and introduced these policies in which a gender equality programs will be promoted. every government should be take an initiative to conduct the training to the young women with providing a stipend to each participant during these trainings. while providing the training to these women these government should established the women incubation business centers in these centers they provide such kind of the skills to these women which not only promote their confidence level among these participants but also promote their inner ability of the creativeness. the government should launch such rehabilitation programs for those women entrepreneurs whose businesses are badly affected during this crisis, to provide them another business opportunity to re-established their business from grass-root level. for those women wo are interested to starts a new venture also provide them logistic and financial support for them and also provide the unique business ideas to these interested females-entrepreneurs as well. to financing the new project, the government should provide these finances to these women without any complicated procedures. they should provide the required funding’s to these women at their home steps. for the training purpose to these women the government should take the help from different expertise and ngo’s. it is necessary for all of us that we should learn lesson from this crisis and it is also very necessary that we should take drastic steps to promote the innovative skills among the young entrepreneurs of our society. references abrahamsson, a. 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(2020). the use of antiinflammatory drugs in the treatment of people with severe coronavirus disease 2019 (covid-19): the experience of clinical immunologists from china. clinical immunology, 108393. south asian review of business and administrative studies vol. 1, no. 2, dec 2019 81 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no. 2, december 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas factors affecting of students' preference towards choosing university in south punjab, pakistan syed muhammad mohi ud din, government railway school, pakistan muhamamd shafiq, faculty of management sciences, foundation university, pakistan article details abstract history revised format: nov 2019 available online: dec 2019 keywords distance from home, academic reputation, quality of teaching, students’ preferences, pakistan the purpose of the study to determine the factors affecting of students' preference towards choosing university in south punjab, pakistan. the higher education environment in pakistan has become very determined and universities have to effort for enrolling highly knowledgeable students. the students have become consumerists due to rising fees of higher education institutes. the principal focus of this study was to disclose the factors that students consider dynamic interrelated to their choice of university. education is also very significant of each and every nation. due to education all the developed economy are well developed and they have enhanced their educational strategies and attain them properly and development cannot be achievable without the skills and technical labor and it’s enhance the productivity and efficiency of people in pakistan. in this study regression and correlation & (baron and kenny 1996) approach adopted and the sample size is collected from respondent is 278. finally, this study revealed that distance from home, academic reputation, quality of teaching, job prospects, campus atmosphere have positive significant relationship on willingness to pay and also student preference towards choosing university but course suitability have insignificant impact on willingness to pay and students preference towards choosing university. numerous issues of the study, dissimilar variations, tests and trials have been left for the upcoming, due to time restrictions and limitations. in future, it needs concerns a in depth analysis of particular mechanisms, new proposals to try diverse approaches, or simply curiosity. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mohiuddindanish1015@gmail.com doi: https://doi.org/10.52461/sabas.v1i2.437 introduction education performs a key responsibility in the progress of the countries as it is one of the basic prerequisites for human growth and to break out from poverty’ and it is obligatory for nationalized growth and a flourishing society. education is the liability of the administration and should be coped through national resources (akareem & hossain, 2016). https://journals.iub.edu.pk/index.php/sabas mailto:mohiuddindanish1015@gmail.com https://doi.org/10.52461/sabas.v1i2.437 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 82 in pakistan higher education system has develop progressively and significant influence on pakistan encouraging intent of becoming entirely advanced country and guided to a twofold-ness of higher education system in pakistan and he sector is divided into private and public institute (khan, 2010). the he sector has managed to enhance in the figure of private he institute in country. the growth of private higher education institute, with globally institute, has led these higher education institute to challenge to attract local and global students. the real wealth of a nation is the people and this wealth increase when its people gain more knowledge and become more self-dependent. education performs a key role not only in the growth of the countries but also expansion fairness in individual life. education is also very significant of each and every nation. due to education all the developed economy are well developed and they have enhanced their educational strategies and attain them properly and development cannot be achievable without the skills and technical labor and its enhance the productivity and efficiency of people (hua et al., 2014). so, education is equaled significant for the development of third world country pakistan also. education has the power to empower people in four way and firstly, education enhances an individual’s choices in life; secondly, it is an instrument of economic expansion; thirdly, it influences the balance of power in society and finally, the change in power distribution has many indirect positive effects (al-ali mustafa et al., 2018). education, thus, yields important common and financial benefits to the individual and the society as entire. universities world-wide have been facing enhancing rivalry for pupils due to reduced administration expenditure on higher education (he) and at global level of the he market. further, these factors may vary by country, and even different sectors of areas. so, this research tries to found these factors in a pakistani context, using different factors. the current research is mainly to identify the determination of student’s choice about university selection. a student preference to choose a university is not an easy task and the decision or choice provides the base of individual future as well as nation future. it is a two-way process, creation a choice requires choosing one of the alternates and providing up the other changes and it is not informal assumed to be (taylor, 2019). this choice is much more-tricky when it is make in early ages. the outcome of this choice make is also a determiner of the educational success. most of youthful people for the choice of go into university is the most valuable decision that will influence their own lives (setiyono, 2014). this choice significant in terms of creating and determining person’s life for the upcoming years and when the point that there are a lot of issues affective such an significant outcome and a choice is also chosen into deliberation, the situation becomes more problematic (garwe, 2018). in our country the enhancement in academies, the idea of attainment the fact that was comprehensive via the well-established academies and the manifestation of the universities that were created future and a short time required the universities to compete with each other (akareem & hossain, 2016). the significant causes it is main to be chosen through the students with the anticipated abilities besides the problematic satisfying the ability for the institute. to offer this, the academies are making an exertion to reorganize their sketch and procedures and be more progressive. pakistan nowadays there are different prospects for higher secondary school pupils to move university and further, pupils to select their preferences from a huge number of universities and colleges, whether they are private or public, or foreign he institute (rudhumbu et al., 2017). the fact observed most in this respects is parent’s readiness to pay university expenses and take this readiness in sense of investment in form of his/her teen-agers job return and sociologists and south asian review of business and administrative studies vol. 1, no. 2, dec 2019 83 economists have been generally anxious with parent investment in children, that investment has hardly been studied directly (steelman & powell, 1991). as a consequence, higher education institutes have become more shy in engaging more pupils and retentive them than ever formerly. faced with increasing modest ecosystem, higher education institutes have augmented rivalry for engaging and retentive pupils by offering high attribute facilities as a solution to rivalry in this tempestuous market. therefore, a survey conducted to measuring antecedent of student preference for the choice of universities of pakistan. problem statement the graduating pupils in every year are faced with the difficulty of to decide on future career directions. for this purpose, parents are more curious and trying to avail best option ever before they used (they take gaudiness from those people who are professional and attached with education sector. they have keen observation on current and future trend. they wish their children get that education that they wish to get but due to some blackness or shortage they can’t get). basically this choice process is between student and their parents and success of choice on a common point and their effects is a long way journey. those students who are in view of joining a university, the selection process possibly think high precedence. students his/her family wish, dreams have also very composite part for the selection of university (garwe, 2018). the institute significant role for the future alarms of the students. it’s the institute that defines the interest and priorities in the upcoming life of the student. it is also important to know that while male and female students have equal opportunities to choose an institute or not. previous researches indicated different causes may influence the choice of students regarding their higher-education. the current research intended to scrutinize the preferences of the students though selecting an institution for their higher education. besides these preferences the present study also aimed to determine the role of diverse factors like distance from home, academic reputation, quality of teaching, job prospect, campus atmosphere and course suitability. however, the academia selection way allows students to examine numerous alternatives. identifying issues that have been deliberated by students was the aim of this research. research gaps recent studies have shown that higher education system is increasingly focused on the economy. education marketing is an emerging sector in pakistan and there is not enough research to encourage research in that field. in the 1980s there developed in the united states and the united kingdom the idea of taking educational institutions. research into the positioning, hiring and promotion of educational establishments is inadequate. (ahmad et al., 2013). most of the research have been conducting on student preference towards choosing university but not dynamic way. in this study we have taken different variables from different studies and compile them like distance from home, academic reputation, quality of teaching, job prospect, campus atmosphere, course suitability and mediating variable willingness to pay impact on student preference towards choosing university. this paper aims to understand the gap so that we know how students prefer to choose universities that implement the department of higher education as compared to those that don't. objectives of the study: the objectives of the present study are divided into two categories, main objectives and sub objectives with respect to their importance; main objectives: main objectives of the current study is to determine the factors affecting students’ choice of university in south punjab, pakistan. sub-objectives: sub-objectives of the study are given below; south asian review of business and administrative studies vol. 1, no. 2, dec 2019 84 ro1: to scrutinize the impact of distance from home on student choice of university in south punjab, pakistan. ro2: to scrutinize the impact of academic reputation on student choice of university in south punjab, pakistan. ro3: to scrutinize the impact of quality of teaching on student choice of university in south punjab, pakistan. ro4: to scrutinize the impact of job prospect on student choice of university in south punjab, pakistan. ro5: to scrutinize the impact of campus atmosphere on student choice of university in south punjab, pakistan. ro6: to scrutinize the impact of course suitability effect on student choice of university in south punjab, pakistan. ro7: to scrutinize how willingness to pay the mediate effect the relationship between of distance from home, academic reputation, quality of teaching, job prospect, campus atmosphere, course suitability on student choice of university in south punjab, pakistan. research questions: main research question: main question of the current study does factors affecting students’ choice of university in south punjab, pakistan? sub-research questions: rq1: do distance from home have influence on choice of institutions? rq2: do academic reputation have influence on choice of institutions? rq3: do quality of teaching have influence on choice of institutions? rq4: do job prospect have influence on choice of institutions? rq5: do campus atmosphere have influence on choice of institutions? rq6: do course suitability have influence on choice of institutions? rq7. does willingness to pay mediates the relationship between distance from home, academic reputation, quality of teaching, job prospect, campus atmosphere, course suitability on student’s choice towards university. scope of the study: the study is about the prospects student’s (in south punjab, pakistan) preferences and their behavior of willingness to pay to choice educational institute, so it is helpful for the pupils to choice of institute for higher education or also for stakeholder like parents of pupils, organizational owners in private sector, and hec will be the significant of this research. the hec can make their polices on the basis of the information available in this study. further, this study explains the causes that influence student intent to study in advanced education. the study revealed that will help pupils and institute glowing upcoming planning and executive. literature review distance from home: students generally consider the locality, exactly the move away from home of academia and they desire to join while restricting fuzz the ones. although this fact, there is very few study to scrutinizing actual pupil behavior. there is very less published study on the theme of the distance pupil’s go to institution like the higher education research institute (bright & pryor, 2011) published a paper that showed that former generation pupils, pupils whose family have not any university experience, and other possible to remain nearby to house. while 50% of earliest generation pupils joined universities inside 50 miles of their household, only 36% of their nonearliest generation friends stayed that nearby. the statistics based on a national survey of college freshman for the class of 2005. the same as before study by higher education research institute (pryor et al., 2007) offered leaning data above the previous 40 years on numerous university conclusions, as well as the move away pupils’ travel for university. they discovered that in 1969, 35.9% of pupils remained inside 50 miles of their house. in 2006, this percentage determined approximately the similar, with 35.3% south asian review of business and administrative studies vol. 1, no. 2, dec 2019 85 of pupils waiting within 50 miles of home-based. the analysis also revealed that distance moved by gender. in 1969, 34.4% of males remained within 50 miles as associated to 37.9 percent of females. in 2006, the percentage of males staying that close stayed roughly the same, 34.6 percent, though the number dropped slightly for women, to 35.6%. besides the heri report disaggregating conclusions by gender, very inadequately is recognized about the effect of student points on distance voyaged to join university (far et al., 2009). h1: distance from home have a significant impact on the student preferences for the choice of universities of south punjab, pakistan academic reputation: the origin status is the civic incentive provided by de tocqueville in the 19th century and public demand in conferences. cases that have contributed to the prestige of higher education institutions, with entrance choices, graduate accomplishments, and quality of their faculties, size and expenditure of their works, number of collections of libraries, colleague rankings, and managing quality have been identified today by researchers. academic work also entails exams and/or university divisions in the field of academic standing. (garand & graddy, 1999). h2: academic reputation has a significant impact on the student preferences for the choice of universities of south punjab, pakistan quality of teaching: in the us above the last 50 years, pupil estimates instructors have developed habitual. in most american university class-rooms nearby or at the end of all time, teaching staff, managers, or their subordinates pass out and gather standardized devices which ask pupils to estimate their lecturers on a change of aspects, such as ability, effectiveness, easiness, timeliness, and a fill of other items. the retorts are carefully collected, secure, stored, observed and explained to the faculty concerned, as well as to their supervisors and numerous academia bodies. the data for each faculty are associated to those together from their equals within their departments and plans as well as via the complete academia faculty. the results revealed that faculty concerned to their supervisors, and rarely to the public. this large-scale inventorying of pupil replies is defended mostly on two bases: first, to estimate lecturer performing as origin for decisions on retentive, reward, and upgrade; and, second, to improve faculty colleague’s newness areas of power and flaw in their education and thereupon resolve those flaws recognized though making on the powers and the luxurious or time wasting practice continues in the face of two well-known difficulties (opdecam et al., 2014). first, there is a suggestion to encouragement the sense that pupils are capable to estimate valuable education. this study reliable: pupils try that faculty whom they “like” as valuable and those whom they “dislike” as abortive lecturers. that from is the pupil viewpoint, and assessments are mainly status level. a latest popular try into the “how much do you like your lecturer” sweeps-takes is rate my professors.com, which covers the further valuation item of “how hot” rated instructor’s rank. (garand & graddy, 1999) (wubbels & brekelmans, 2005). second, there is a suggestion that faculty member’s general create methodical adopt of these statistics to rise their educating skills or to better their flaws. to overall methods of the value of a given university teacher, pupil reviews have also been used to evaluate the value of teaching methods and inventions in a class of environment like involve studies stated for lecturer, music, science, and several others (demiroren et al., 2008). h3: quality of teaching has a significant impact on the student preferences for the choice of universities of south punjab, pakistan south asian review of business and administrative studies vol. 1, no. 2, dec 2019 86 job prospect: a landing well job is the biggest factor for the candidates to go abroad and it is confirmed in a current report by higher education data professionals qs also, as the numbers of pupils studying foreign is regularly increasing up and many of them need to continue to be in the same area for well employment and good experience. their teaching also supports them in their quest for the jobs. in the 2015 times higher education employability ranks, exhibits that the topmost 50 places were led by universities in just a little of countries. the us and uk acquired greatest of the top acnes, and the only other countries to have a significant existence in the list take place france, germany, australia, china and canada. several studies have scrutinized the awareness pupils studying in universities hold about their employability and anything is needed of them in the labor market by means of they make to link the world of exertion. recognized interaction, proficiency, information technology and ‘education how to learn’ as foremost skills requirement by organizations in any sector, whereas cbi survey (2011) revealed that graduates now must proficiencies in; self-management, teamwork, problem-solving, communication, application of information technology, application of skill, business and consumer awareness held by a positive attitude are acute for the employability of academia graduates. on the other hand, found that morality, honesty and reliability were very appreciated by employers at the same time as cihe survey (2008) found a positive attitude as significant essential employers look for in defining the employability of graduates. though, the cbi (2011) indicates that, just about half (49%) of pupils are great about the skills employers must, this was in conventionality with overachievers, (2012) who reiterated pupil’s over-all absence of knowledge of the abilities need of them by the labor market. another study by the british chamber of commerce (2011) revealed that only a third of micro-businesses surveyed having self-assured that graduates would have the right expertise. in a well-defined gap, ukces (2011) survey discovered that most (87%) of organizations thought that graduates were enormously ready to meet the skills requisite of the labor market, which were not any diverse from the hecsu (2012) survey which stated that 80% of pupils surveyed were self-assured they had the skills administrations need. h4: job prospects has a significant impact on the student preferences for the choice of universities of south punjab, pakistan course selection: what need to be considering as choosing an academia course? when you have determined what theme you need to study at university, the next point to do is choose what academia is present that course. now, make a list of points to emphasis, when you funnel your selections to a particular plan to build the difficult task somewhat stress-free. teaching methods: you did not recognize about all lectures of university also being sat in a lecture theatre with the sum of your course pay attention to a range of researchers examining areas of research in extent, there are several other methods of teaching and education. for instance workshops: in workshops similar amount of persons as in conference (10-15), but further collaborating and pragmatic in nature. rather than concentrating on matters elevated from course book and lectures, classes are dynamically attractive, requiring pupils to complete assignments and group activities. if you gain knowledge of best by doing, workshops will be an efficient means of impressing info into your mind. tutorials: this is everywhere; number of pupils is in groups of 4-6 meet with their individual instructor to experience a more intimate knowledge experience. from examining themes directly connected to exact elements, to anticipating academia life and smoothing over any questions, given south asian review of business and administrative studies vol. 1, no. 2, dec 2019 87 material cover all aspect of the academia knowledge. lectures are outstanding for help you interested in university life. contact hours: about courses, such as knowledge, have massive volumes of contact hours. less contact hours give you the self-determination to select what you would like to education. asleeping your way through your gradation will not be valuable for any amount of time. assessments: assessments mean an infinite number of exams. if exams emphasize you out, it is perhaps best alternative an essay heavy based program. by now you will have figured out where your powers and flaws lie (heri; cirp, 2008). h5: campus atmosphere has a significant impact on the student preferences for the choice of universities of south punjab, pakistan campus atmosphere: the stress recovery theory from ulrich (srt) and focus attention restoration theory (art) from kaplan typically represent the work on ecological choice and renewal. srt is psycho-evolutionary in its vision and recommends contact with the world and begins an immediate, expressive reaction (affect). this expressive reaction has consequences that protect well-being and survival, or habits. for example, the early impact reaction (fear) will encourage avoidance when contemplating the bear on a journey into nature. in certain other cases, emotional reactions are due to non-engagement adaptive goals. these emotional responses can persuade alterations in physical and psychological states for stressed persons, and keep emotional resources in best state for unstressed persons. according to srt, positive affective responses to ecosystems are more likely after an ecosystem includes moderate to high intricacy, physical properties that found a focal point, moderate to high levels of complexity, an even ground service, a bent line of site, and while the ecosystem is observed as safe, clear, and recognizable. h6: course suitability has a significant impact on the student preferences for the choice of universities of south punjab, pakistan willingness to pay: the wtp way was basic applied in the health sector in the famous study of wtp to evade heart attacks by acton (1973). in customary welfare economics, determined wtp signifies the hypothetically right measure of ‘power of preference’ for, or worth of, goods. the pupils’ wtp for seven course traits, with cost and three others related to the kinds of online developments (web-based learning guide, electronic class notes, and pod players of the lecture videos). from an economic view, persons make investment decisions in postsecondary education on the basis of variables such as the expected budgets, the predictable profits, and the value of educational selections. so, financial traits of educational organizations (e.g., tuition, financial aid, housing, and cost of commuting) are usually involved. many educations of postsecondary participation and academia select have been directed employing numerous or all of these variables. h7: willingness to pay mediates the positive/negative relationship between distance from home, academic reputation, quality of teaching job prospects campus atmosphere course suitability and student preferences for the choice of universities of south punjab, pakistan student preferences: a group of youngest people, the choice of go into university is the very significant decision that will influence their individual lives. this decision is significant in names of building and defining individual’s life for the next years (green & celkan, 2014). a lot of factors influencing such significant assessment and a select are also taken into matter; the condition turns into more problematic. today’s pupils can be leader’s tomorrow’s and leaders in all extent of the people, who control several politics and take decisions can assume and modification our world (zhou, 2014). the character of institute education and knowledge in the students’ befitting tomorrow’s leaders and confirming their stability of societal growth can for no reason is south asian review of business and administrative studies vol. 1, no. 2, dec 2019 88 disregarded. for, academia learning and feel makes it easier for the persons to be elevated as wellinformed, accountable, and brilliant peoples in individual terms. academia education in terms of social and knowledge affects the program and regeneration of knowledge, thoughts, abilities, and manners patterns possible. from the perception of sustaining continuous growth and change, academia education and knowledge can re-shape and support the activities and the level of awareness of the academia pupils and sets them as decent instances for the society (zhou, 2012). there are many of issues that pupils might consider while defining their preferences for a particular academia, consist of, ✓ the nature of program that they aim to do like business, law etc. ✓ the university status of the organization (very good, sound, poor) ✓ the university environment ✓ the excellence of education staff ✓ the class of university (ancient or up-to-date, outdated or technological) they study also about personal influences like ✓ distance from household ✓ the academia their friends desire to attend ✓ what their family thinks about both academia (good or poor respect) h8: there is positive and negative relationship between distance from home, academic reputation, quality of teaching job prospects campus atmosphere course suitability and student preferences for the choice of universities of south punjab, pakistan conceptual framework research methodology research approach: this study in quantitative in nature and deductive approach have been adopted. research design: this research thesis is explanatory because it is investigated after identification of problem and it gives the causal relationship between independent (iv) and dependent variables (dv). sampling method and sample size: in this research sample size would be 278 students of different universities within the boundary of south punjab, pakistan and convenience sampling have been adopted. independent variables mediating variables dependent variables distance from home job prospects academic reputation quality of teaching campus atmosphere course suitability willingness to pay students’ preference towards choosing university south asian review of business and administrative studies vol. 1, no. 2, dec 2019 89 survey instruments: the close ended questionnaire was developed a given out to the relevant population and the questions on five-point likert scale have been used. statistical test and tool: in this research study statistical test have being adopted reliability, normality, correlation and regression and mediation analysis by using the data for this research descriptive inferential statistics and spss 20 are used. dana analysis and interpretation reliability analysis: reliability analysis refers to measure the consistency of all the items appearing in the instrument. this consistency calculated through model-cronbach’s alpha value. when items of measuring scale relate to each other the phenomena are said to reliability. the value of cronbach's alpha ranging from 0.8 to 0.7 is normally preferred and acceptable value is equal to 0.5. (nunnally, 1994). table 1 reliability statistics cronbach's alpha n of items .795 8 in the above-mentioned table, cronbach's alpha value is equal to 0.795. according to above mentioned criteria it is considered good value and assures that internal consistency of all the items in questionnaire is acceptable. normality analysis: a normality test is a phenomenon that assures sample taken for collecting data lies under standard normal distribution. in this analysis shapiro-wilki test is applied to measure the normality of instrument (garson, 2012). the test is applied check the normality of large sample. it is also called goodness of fit when the data is interval or near to interval. table 2 in the above mentioned table the significant value of k-s test all the variables are less than 0.05 and its mean that distribution is supposed to be normal. independent variables predicting the dependent variables (baron and kenny approach 1996) regression analysis: it is a statistical tool that is used to measure the relationship between two variables. it explains the relationship between independent variable and dependent variable. this tests of normality kolmogorov-smirnova shapiro-wilk statistic df sig. statistic df sig. distance from home .257 200 .000 .821 200 .000 academic reputation .502 200 .000 .376 200 .000 quality of teaching .249 200 .000 .846 200 .000 job prospect .167 200 .000 .938 200 .000 campus atmosphere .261 200 .000 .877 200 .000 course suitability .146 200 .000 .935 200 .000 willingness to pay .223 200 .000 .894 200 .000 student preferences .244 200 .000 .802 200 .000 a. lilliefors significance correction south asian review of business and administrative studies vol. 1, no. 2, dec 2019 90 technique specifically measures that how much change in independent variable is accounted by independent variable. according to researcher various diversity attributes effect of team performance can be analyzed through regression analysis. so the concerned research will show application of regression analysis on iv and dv model (wicker, 2016). table 3 model summary model r r square adjusted r square std. error of the estimate durbin-watson 1 .561a .314 .293 1.04321 .964 a. predictors: (constant), course suitability, job prospect, quality of teaching, academic reputation, campus atmosphere, distance from home b. dependent variable: student preferences table 4 r measures the correlation between observed and dependent variables. it is the square root of r square (bruin, 2006). r square(r^2) is also called co-efficient of determination. it is a proportion of amount of the variability in one variable can be explained by variation in the other. it is key output of regression analysis. it gives information about proportion of variation (frost, 2019). r square shows the variance difference between dependent and independent variable which is 0.314. it indicates a moderate variance exists between iv and dv. the value of r^2 always in the range of 0 and 1. analysis of variance indicates p value = 0.000 which can be said that model is fine. the adjusted r^2 measures adjusted for degree of freedom. in the above table, adjusted r^2 value is .293 which is significant in this data. it shows that the course suitability, job prospect, quality of teaching, academic reputation, campus atmosphere, distance from home explained 29.3% variation in student preference towards university. table 5 anovaa model sum of squares df mean square f sig. 1 regression 96.341 6 16.057 14.754 .000b residual 210.039 193 1.088 total 306.380 199 a. dependent variable: student preferences b. predictors: (constant), course suitability, job prospect, quality of teaching, academic reputation, campus atmosphere, distance from home coefficients model unstandardized coefficients standardized coefficients t sig. correlations collinearity statistics b std. error beta zeroorder partia l part tolerance vif 1 (constant) 4.099 2.591 1.582 .115 distance from home -.021 .067 -.021 -.315 .000 .008 -.023 .019 .783 1.278 academic reputation .151 .085 .111 1.778 .002 .124 .127 .106 .918 1.090 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 91 in the above table showed that vif value is 1 and greater than its mean that in this research study no issue of multicollinearity. above table also showed that distance from home, academic reputation, quality of teaching, job prospect have significant impact on students preference towards choosing university and further revealed that course suitability have insignificant impact on student preference towards choosing university independent variable predicting the mediator (baron and kenny approach 1996) regression analysis table 6 model summary model r r square adjusted r square std. error of the estimate durbin-watson 1 .646a .417 .404 1.46260 1.852 a. predictors: (constant), course suitability, academic reputation, distance from home, campus atmosphere, job prospect, quality of teaching b. dependent variable: willingness to pay table 7 quality of teaching -.216 .090 -.153 -2.399 .000 -.266 -.170 .143 .870 1.150 job prospect .282 .057 .322 4.940 .0003 .264 .335 .294 .834 1.200 campus atmosphere .439 .073 .399 6.022 .000 .430 .398 .359 .810 1.235 course suitability .026 .051 .034 .507 .613 .100 .036 .030 .799 1.252 a. dependent variable: student preferences south asian review of business and administrative studies vol. 1, no. 2, dec 2019 92 table 8 anovaa model sum of squares df mean square f sig. 1 regression 406.232 6 67.705 31.650 .000b residual 566.886 265 2.139 total 973.118 271 a. dependent variable: willingness to pay b. predictors: (constant), course suitability, academic reputation, distance from home, campus atmosphere, job prospect, quality of teaching r square shows the variance difference between dependent and independent variable which is 0.417. it indicates a moderate variance exists between iv and mediating. the value of r^2 always in the range of 0 and 1. analysis of variance indicates p value = 0.000 which can be said that model is fine. in the above table, adjusted r^2 value is .404 which is significant in this data. it shows that the course suitability, job prospect, quality of teaching, academic reputation, campus atmosphere, distance from home explained 40.4% variation in willingness to pay. distance from home, academic reputation, quality of teaching, campus atmosphere, and job prospects has a positive strong significant impact on willingness to pay of student’s preference towards choosing of university, and p value less than 0.05. the regression coefficient table exhibits that the p < 0.05. hence, hypothesis (h7) is accepted and above results reveal that course suitability has insignificant roughly contributes 3.4 % to student’s preference towards choosing university. mediator variable predicting the dependent variable (baron and kenny approach, 1996) regression analysis table 9 model summary model r r square adjusted r square std. error of the estimate durbin-watson coefficientsa model unstandardized coefficients standardized coefficients t sig. correlations collinearity statistics b std. error beta zeroorder partial part tolera nce vif 1 (constant) 2.80 2 .677 4.137 .000 distance from home .071 .034 -.191 -2.047 .000 .445 -.125 .096 .253 3.957 academic reputation .136 .045 .150 3.053 .002 .294 .184 .143 .905 1.106 quality of teaching .177 .051 .321 3.462 .001 .536 .208 .162 .255 3.922 job prospect .164 .039 .319 4.203 .000 .556 .250 .197 .383 2.613 campus atmospher e .168 .057 .225 2.952 .003 .549 .178 .138 .378 2.649 course suitability .025 .052 -.034 -.484 .629 .435 -.030 .023 .451 2.218 a. dependent variable: willingness to pay south asian review of business and administrative studies vol. 1, no. 2, dec 2019 93 1 .109a .012 .007 1.23650 .691 a. predictors: (constant), willingness to pay b. dependent variable: student preferences table 10 anovaa model sum of squares df mean square f sig. 1 regression 3.651 1 3.651 2.388 .000b residual 302.729 198 1.529 total 306.380 199 a. dependent variable: student preferences b. predictors: (constant), willingness to pay r square shows the variance difference between dependent and independent variable which is 0.012. it indicates a moderate variance exists between mediating and dv. the value of r^2 always in the range of 0 and 1. analysis of variance indicates p value = 0.000 which can be said that model is fine. the adjusted r^2 measures adjusted for degree of freedom. in the above table, adjusted r^2 value is .007 which is significant in this data. it shows that the willingness to pay explained 7% variation in student preference towards choosing university. table 11 willingness to pay a positive strong but significant impact on student’s preference towards choosing of university, and p value less than 0.05. the regression coefficient table exhibits that the p < 0.05. hence, hypothesis (h8) is accepted and above results reveal that willingness to pay contributes 10.9 % to students preference towards choosing university. coefficientsa model unstandar dized coefficient s standardi zed coefficie nts t si g. correlations collinearity statistics b std . err or beta zero orde r part ial par t tolera nce vi f 1 (consta nt) 11. 758 .86 6 13. 571 .0 00 willing ness to pay .12 3 .08 0 .109 1.5 45 .0 04 .109 .10 9 .10 9 1.000 1.0 00 a. dependent variable: student preferences south asian review of business and administrative studies vol. 1, no. 2, dec 2019 94 correlation analysis: this test helps to determine the degree of relations between different research variables. it speaks of the intensity and nature of the relationship (positive or negative). the values used to verify the relationship vary from -1 to +1 indicating whether the relationship is positive or negative. table 12 correlations distanc e from home acade mic reput ation quali ty of teac hing job prosp ect campu s atmos phere course suitabil ity willingn ess to pay studen t prefere nces distan ce. from home pearson correlati on 1 .101 .831* * .734** .615** .570** .425** .008 sig. (2tailed) .093 .000 .000 .000 .000 .000 .907 n 278 276 277 276 275 277 276 200 acade mic reputa tion pearson correlati on .101 1 .147* .173** .296** .213** .294** .124 sig. (2tailed) .093 .014 .004 .000 .000 .000 .080 n 276 276 276 275 274 276 275 200 qualit y of teachi ng pearson correlati on .831** .147* 1 .685** .645** .593** .515** -.266** sig. (2tailed) .000 .014 .000 .000 .000 .000 .000 n 277 276 277 276 275 277 276 200 job prospe ct pearson correlati on .734** .173** .685* * 1 .652** .590** .546** .264** sig. (2tailed) .000 .004 .000 .000 .000 .000 .000 n 276 275 276 276 274 276 275 200 campu s atmos phere pearson correlati on .615** .296** .645* * .652** 1 .707** .538** .430** sig. (2tailed) .000 .000 .000 .000 .000 .000 .000 n 275 274 275 274 275 275 274 200 course suitabil ity pearson correlati on .570** .213** .593* * .590** .707** 1 .432** .100 sig. (2tailed) .000 .000 .000 .000 .000 .000 .159 n 277 276 277 276 275 277 276 200 willin gness to pay pearson correlati on .425** .294** .515* * .546** .538** .432** 1 .109 sig. (2tailed) .000 .000 .000 .000 .000 .000 .124 n 276 275 276 275 274 276 276 200 studen t prefere nces pearson correlati on .008 .124 .266* * .264** .430** .100 .109 1 sig. (2tailed) .907 .080 .000 .000 .000 .159 .124 n 200 200 200 200 200 200 200 200 south asian review of business and administrative studies vol. 1, no. 2, dec 2019 95 **. correlation is significant at the 0.01 level (2-tailed). *. correlation is significant at the 0.05 level (2-tailed). the above table explains that strong positive significant relationship is present between distance form home and willingness to pay with r= 0.425. the distance from home have significant but positive strong week relationship on student preference towards choosing university. with r= 0.008. the findings also reveal that there is a positively significant but week relationship of academic reputation and willingness to pay with r= .294. the academic reputation have significant but positive strong week relationship on student preference towards choosing university. with r= 0.008. the findings also reveal that there is a positively significant but moderate relationship of quality of teaching and willingness to pay with r= .515. the quality of teaching have significant but negatively week relationship on student preference towards choosing university with r= -0.266. the above table also reveal that there is a positively significant but moderate relationship of job prospects and willingness to pay with r= .546 and also the job prospects have significant but positively week relationship on student preference towards choosing university with r= 0.264. the above table also reveal that there is a positively significant but moderate relationship of campus atmosphere and willingness to pay with r= .538 and also the campus atmosphere have significant but positive strong relationship on student preference towards choosing university with r= 0.430. the above table also reveal that there is a positively significant but moderate relationship of course suitability and willingness to pay with r=.432 and also the course suitability have significant but positive strong week relationship on student preference towards choosing university with r= 0.100. the table also reveal that there is a positively significant but moderate relationship of willingness to pay and distance from home, quality of teaching, job prospect, campus atmosphere, and course suitability and also the willingness to pay have significant but positive strong week relationship on academic reputation and also on student preference towards choosing university with r= 0.124. discussion and conclusion discussion of the study starts with answering the question that was stated as the key inquiry to be addressed is that the first hypothesis is distance from home has a positive strong significant impact on student’s preference towards university. hence, first hypothesis is accepted. the second hypothesis academic reputation has a positive strong significant impact on student’s preference towards choosing of university. hence, second hypothesis is accepted. the third hypothesis is quality of teaching has a positive strong significant impact on students preference towards choosing of university. so, third hypothesis is accepted. the fourth hypothesis job prospect has a positive strong significant impact on student’s preference towards choosing of university. hence, fourth hypothesis is accepted. the fifth hypothesis is campus atmosphere has a positive strong significant impact on student’s preference towards choosing of university. hence, fifth hypothesis is accepted. the sixth hypothesis is course suitability has a positive strong insignificant impact on student’s preference towards choosing of university. hence, sixth hypothesis is rejected. the seventh hypothesis is distance from home, academic reputation, quality of teaching, campus atmosphere, job prospects, has a positive strong significant impact on willingness to pay on student’s preference towards choosing of university. hence, hypothesis seventh is accepted, while course suitability has a positive strong but insignificant impact on willingness to pay of student’s preference towards choosing of university. the eight hypothesis willingness to pay a positive strong but significant impact on student’s preference towards choosing of university. hence, hypothesis eight is accepted. results indicate that the most important determinants of university preference were distance from home, academic reputation, job prospects, campus facility, quality of teaching and willingness to south asian review of business and administrative studies vol. 1, no. 2, dec 2019 96 pay which has significance on students preferences towards choosing university and programs and others like course suitability, insignificant impact on student’s preference towards choosing universities. future research due to time constraints and restrictions, several parameters of the research, numerous modifications, tests and experiments have been left for the future. in the future, a detailed review of current processes, innovative initiatives to test alternative approaches, or even interest, would need to be discussed. number of questions can be increased in questionnaire to improve and get more information and know about the understanding of students. in order to improve the standard of education, we have to explore and change the traditional education system in order to expand the willingness of students to know more and more. this study did not examine students' decision-making capabilities, offering an area for future studies. further studies in other over-all areas of pakistan could be relevant for the knowledge gathered from this analysis and conclusions drawn. the thesis is quantitative in nature, thus involving exploratory review to resolve exceptional research problems that have a larger effect on the choice of a university and course by students. differences between private and public colleges were not discussed in the report. future studies can explore the gap between public and private universities' student decisions. managerial implications it has been so far established that concrete measures by accommodating student voices are required to improve services quality from its present marginalized state to the highest echelon as per students’ satisfaction as well as market demands in higher education sector. universities must keep on continuously assessing their practices regarding services quality for its improvement and to uplift the professional reputation of the institution. implications for universities are the study or re-examination of education funding & scholarship policies and the making of required arrangements for student settlement in the field. the position of the department of career development has increased and universities need to improve the job rates of institutionally offered courses. this also has consequences for institutions, regardless of the gender differences found in this report, to remove gender barriers between different classes, offer equal opportunities and take appropriate steps to inspire students to participate in all classes. the marketing resources should be developed based on the desires of students that they consider essential and not in line with the practices of universities that they consider important to students. this condition draws the attention of the pakistan higher education board, the government of pakistan ministry of education, the administration of universities to improve the country’s higher education quality & standards. however, relevant causes, not major ones, should be given consideration. limitation there are some limitations of the research under consideration. the study was only conducted in south punjab of the country so its results cannot be generalized. second in covid-19 the institute, colleges and university are not willing to share their student's information. not even a single college or institute and university is ready to share. so, other methods were used and references used to share the information thirdly the research has considered only six variables for explaining factors affecting of choosing university. references ahmad, w., sabir, i., ashraf, r. u., & ahmad, n. 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(2014). from better understandings to proactive actions: housing location and commuting mode choices among university students. transport policy, 33, 166–175. https://doi.org/10.1016/j.tranpol.2014.03.004 microsoft word sabas, v4 i2 p3.docx south asian review of business and administrative studies vol. 4, no. 2, dec 2022 113 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas how does transformational leadership style effect on the organizational performance? the case of educational institutions muhammad hafeez, department of education, institute of southern punjab, multan, pakistan samikshya bidari, institute for excellence in higher education, tohoku university, japan article details abstract history revised format: nov 2022 available online: dec 2022 keywords transformational leadership, effect, organizational performance, educational institutions transformational leadership style can motivate and satisfy followers by helping and inspiring them in a friendly manner. a transformational leader has a clear vision about how to manage an educational institution to achieve the defined goals and objectives. he/she has the ability to create conducive learning environment for the teachers and students. a transformational leader has the skills and potentials to develop the learning community in an educational institution. a review of previous researches studies was done to conclude the previous researches that how does transformational leadership style effect of on the organizational performance in case of educational institutions. a total of 178 previous studies were selected by following the inclusion and exclusion criteria. the results of the review of researches studies indicated that transformational leadership style has a great impact on the performance of the educational institutions. the transformational leader can build a learning community by involving teachers, students and society by establishing a vision and creating conducive learning environment in an educational institution. moreover, transformational leadership model is also discussed in this study. © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mh9589041@gmail.com doi: https://doi.org/10.52461/sabas.v4i2.1514 introduction academic leadership is dependent on individuals who play significant roles in educational institution administration. these individuals are at the heart of organizational and individual growth, which eventually leads to the development of society (jovanovica & ciricb, 2016). for a long time, the process of categorizing aspects, behaviour, and characteristics of effective leadership in educational institutions has been extensively researched (antonopoulou et al., 2021). the dynamics and characteristics of the educational sector are unique and serve the objectives of meeting educational institutional demands (al-mansoori & koç, 2019). a leadership approach known as transformational leadership encourages team members to grow and perform above and beyond what was previously anticipated (andriani et al., 20218). transformational leadership encourages the growth of people around them. lai et al., (2020) stated that transformational leaders south asian review of business and administrative studies vol. 4, no. 2, dec 2022 114 that urge people to meet expectations can change their views. transformational leadership focuses on how leaders influence their people (bush, 2014). distinct leadership styles have different effects on the outcomes of employees. transformational leadership abilities lead to businesses performing above and beyond expectations. it refers to how a father treats his children in life situations, and it is based on individualized allegiance to the leader and complete surrender to him (budur, 2020). this ultimately resulted in the paternalistic boss who mentors his employees in both their professional and personal life (asad et al., 2021). since a few years ago, organizational commitment and work happiness have become more crucial. these comforts predict employee feedback as good and negative attitudes about work and the business, which may have a significant impact on how people behave in an organization (andriani et al., 2018). numerous academic studies have demonstrated the enormous influence that leadership and organizational culture have on workers' loyalty, trust, and contentment (atan & mahmood, 2019; royhatudin et al., 2020; hai et al., 2021). problem statement and objectives of the study several research studies have revealed that leadership style has a prodigious effect on the performance of individuals as well as the organization (majeed et al., 2017; toufaili, 2018; nicdao, 2019; top et al., 2020; al-husseini et al., 2021). a transformational leadership style is the most influential style of leaders as it changes the individuals by making it a purposeful individual by creating the positive changes. an academic leader having transformational leadership qualities can improve the performance of the individual teachers and educational institutions by influencing on their abilities. he/she can develop the culture of performance in an educational organization by making purposeful changes in the individual teachers. in the current age, the complexity of problems has increased much more. now the leaders have to deal with several problems at a time to keep the track on right line according to the defined goals and for the smooth running of the educational institution. the current age leader has the required abilities and skills to deal all the problems according to the vision and mission of the educational institution. so, it is a time of need to discuss the role of such leadership style that have the abilities to deal with all the complex problems according to the vision statement of the educational institution. so, by keeping in view the importance of transformational leadership style in the current scenario, the objective of current review research was to determine how does the transformational leadership style effect on an organizational performance in case of educational institutions. review of the literature transformational leadership style a leader's leadership style is the repeating pattern of behaviours that he or she exhibits. a leader's style is the usual pattern of behaviour used to persuade subordinates to accomplish organizational objectives. a leader's approach to each of the three functions giving direction, carrying out plans, and motivating people is stated to as their leadership style (putra et al., 2020). transformational leaders are endowed with charisma. they envision and communicate a compelling future in order to motivate their subordinates and appeal to their ideals and moral convictions. this sort of leadership requires leaders and employees to have an emotional relationship. transformational leaders are sincerely concerned about the well-being of their employees (supermane, 2019). transformational leadership includes sensitivity, understanding, compassion, and the ability to develop relationships. it encourages a culture of trust, increases employees' self-esteem, and aids in their personal development (mufeed, 2018). when compared to other leadership styles, the transformational leadership style has garnered considerable support among leadership scholars due to its unique ways of inspiring employee south asian review of business and administrative studies vol. 4, no. 2, dec 2022 115 creativity. transformational leaders boost their colleagues' confidence and values, and as a result, their performance exceeds their expectations (arifin & maunah, 2020). transformational leadership, encourages workers to fulfil their high-level wants as outlined in maslow's hierarchy of needs by instilling in them the value of taking on organizational responsibility (wang & hu, 2017). transformational leaders show a great concern for their workforce, particularly for their needs and personal growth. the traits of a transformative leader inspire the workforce to be loyal, respect, and impressed. employees' job performance has also improved, which is affected by the traits and skills of transformational leaders. in an organisation, there is some mutual trust and respect between the leaders and the employees, and they work together to achieve the organisational goals. transformational leadership is also stated as a leadership style that may inspire good changes in the culture, structure, and strategy of an organisation (lo et al., 2020). with the definitive goal of transforming supporters into leaders, it produces positive and meaningful development in each follower on an individual basis. transformational leadership has been graded using inspirational motivation, idealistic impact, intellectual stimulation, idealized effect behavioural, and employee care. through the employment of higher ideals and embedded internal moral standards, transformational leadership is a technique for inspiring followers to act in ways that are more advantageous to the company than to themselves (mukhtar et al., 2020). a transformative leader sees their followers' needs and strives to address those needs with their complete support. the leader's personality and ability to bring about good change via the dissemination of an inspiring vision and motivating objectives that improve employee performance are what constitute transformational leadership (puni et al., 2018). the fundamental tenet of the transformational leadership theory is that transformational leaders persuade their followers to perform above the organization's desired threshold result by influencing their followers' values, beliefs, norms, and attitudes (jameel & ahmad, 2019). berkovich & eyal, (2021) argued that transformational leadership is motivating and that leaders can effectively change followers' attitudes, ideas, and behavioural patterns for the company, provided evidence in support of this assertion. according to the authors, transformational leaders assist followers see the value of the whole and how positively organisational outcomes impact employees' performance. table 1 shows the traits of transformational leaders. table 1. traits of transformational leaders sr. no trait explanation 1 possibility of new thinking no matter where new ideas come from, transformational leaders are always receptive to them. they are always searching for novel solutions to solve issues and are receptive to all kinds of fresh concepts. 2 mindbroadening ability it is common for transformative leadership to require altering people's views of how things should operate. it is essential to do this through comprehending the justifications for people's current beliefs and learning how to shape their thinking. 3 active listening commitment transformative leaders listen to others' ideas with an open mind and respond to them without bias or resolve. they commit to use active listening techniques to provide their team members a sense of being seen, being heard, and being appreciated. they encourage individuals to express themselves without self-censorship by putting these safeguards in place. 4 ability to accept intelligent risks such risks must be examined, along with the potential implications for the future of the company, by a transformational leader. the leader must be ready to pursue a notion further if it seems practical south asian review of business and administrative studies vol. 4, no. 2, dec 2022 116 and the benefits exceed the risks. when the threat is too great, the leader must recognize that a different plan is necessary. 5 willingness to accept responsibility any invention venturing into uncharted territory must be willing to assume responsibility for the results, good or bad. no one will follow a leader who expects others to shoulder the burden for a faulty strategy. all of a transformative leader's decisions, including approving other people's ideas, must be accountable. 6 trust in team members autonomy is required for people to conceive and form new ideas. the transformative leader trusts the team members to chart their own paths to success. 7 ability to motivate engagement everyone must be expected to innovate, not just one or two people with brilliant ideas, according to the transformative leader. the leader's job is to set an example of creativity and innovation across the world. teams with transformative leaders are ones where everyone shares ideas. transformational leadership model a transformational leadership style concentrates on the needs and development of followers. managers that practise transformational leadership put special emphasis on helping people grow their morals, drive, and values in addition to their skills (ali et al., 2019). in order to establish a clear knowledge of followers' interests, values, and degree of motivation, transformational leadership serves as a conduit between them and the leaders. essentially, it assists followers in achieving their goals while working in an organisational context; it promotes communication and encourages followers to be adaptable to new and improved techniques and environmental changes (ullah, 2018). a transformational leader's conduct springs from the leader's own personal values and beliefs and inspires followers to go above and beyond what is required (bass, 1985). uplifting followers and taking into account their needs are the main goals of transformative leadership. managers that place a strong emphasis on transformational leadership spend a lot of time and energy encouraging the morals, values, and general value system of their staff members (hambali & idris, 2020). in transformative leadership, the followers have complete faith in, respect for, and loyalty toward the leader. further, they are inspired to go above and beyond what was initially anticipated (aguas et al., 20217). the team members are then motivated by the transformational leader by first increasing their awareness of the significance of task results, motivating them to put the needs of the group ahead of their personal interests, and igniting their higher-order demands. leaders encourage followers to exercise critical thought and consider novel job strategies, which stimulates the mind (ndlovu et al., 2018). transformational leadership increases an organization's level of performance, satisfaction, and dedication to its goals. bass (1990) defined transformational leadership as having four components: charisma, inspiring motivation, intellectual stimulation, and individual consideration (renjith et al., 2015). components of transformational leadership model idealized influence the idealized form of influence is also known as charisma, and it is characterized by having a clear vision and a sense of purpose, inspiring a sense of community pride, and earning people's respect and trust. employees are motivated by charismatic behaviour to put the team's needs ahead of their own, ensuring that challenges will be conquered and fostering confidence and certainty in the attainment and execution of influence. followers invest an excessive degree of faith and trust in charismatic leaders (kouni et al., 2018). jyoti & bhau, (2015) stated that a transformative leader's idealized and behavioural charisma motivates followers to identify with the leader. a south asian review of business and administrative studies vol. 4, no. 2, dec 2022 117 transformative leader's personalized relationship fosters an environment in which employees are happy and pleased. as a result, their total performance improves, which in turn raises production. inspirational motivation inspirational motivation, which is often combined with charm and focuses on a leader setting higher standards to position oneself as a benchmark for others to follow, is the second element of the transformational leadership paradigm (vu et al., 2020). the followers look up to their inspirational leader as someone who can make emotional appeals to raise awareness and understanding of goals that benefit both parties. this is indicated by the communication of high expectations and the plain declaration of relevant goals. the leader consistently projects optimism for the future, evoking an exciting sense of organisational transformation, and providing a compelling future vision (zacharo et al., 2018). motivation happens when leaders give their followers' work significance and challenges; as a result, teamwork, excitement, and optimism are sparked. the leader inspires people to imagine appealing future states for the organisation and themselves (freihat, 2020). intellectual stimulation intellectual stimulation offers followers with challenging new ideas and motivates them to depart from traditional ways of thinking. a leader is defined as someone who fosters intelligence, logical reasoning, deliberate problem-solving, and methodical aptitude (duyan & yildiz, 2020). the characteristics include finding diverse views when solving difficulties, providing new ways of assessing how to perform tasks, and encouraging re-thinking of previously unquestioned concepts. the leader encourages the followers to be inquisitive by questioning assumptions and creative by rethinking problems and addressing everyday situations (majeed & jamshed, 2021). individual consideration the fourth and final component of the transformational leadership approach is individual consideration. followers are established by mentorship and coaching. the leader acts as a tutor to the followers, carefully noticing the differences between individuals. the leader is attentive to others' concerns as well as mentoring and aiding others in finding and developing their talents (mbithi et al., 2016). litz & scott, (2017) emphasised the importance of treating followers as unique individuals in order to increase their maturity levels and improve their ability to effectively meet their objectives and obstacles. research question how does transformational leadership style improve the organizational performance? the case of educational institutions methodology article selection process articles included in this review study were selected by searching scopus, the web of science, and the eric databases. initially, 257 studies were identified. after removing the duplicate records of 19 studies, the first and second authors revised all the studies regarding titles and abstracts based on inclusion and exclusion criteria. after removing the duplicate studies, the remaining studies were 238 for screening. records excluded on the basis of the abstract review were n=16, not relevant n=13, and not in english n=2. the total full-text articles assessed for eligibility obtained were n=207. the full-text articles that have no link between transformational leadership style and improvement in educational institutions were also excluded n=29. so, the final studies included in the review were obtained as n=178. the article selection process followed by the prisma diagram is shown in figure 1. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 118 figure 1. prisma flow diagram for article selection results how does transformational leadership style improve the organizational performance? the case of educational institutions leadership style and performance leadership has been acknowledged as an important subject in the realm of organisational behaviour in the literature. the impacts of leadership on interpersonal and organisational interactions are the most dynamic of any factor. in other words, leadership skill determines management's ability to carry out a joint endeavor. outstanding leadership meets the requirements of followers while maximizing their capacity for efficiency and achieving organisational objectives. leadership is the use of a leading strategy to offer a motivating justification and to optimize the staff's growth potential. numerous factors suggested that there is a connection between organizational performance and leadership style (kalsoom et al., 2018). understanding how leadership affects performance is crucial as according to some experts, it is one of the most important aspects impacting the performance of a company. in order to improve organizational performance, effective management is seen as a key driver of managerial progress and a sustainable competitive advantage. for instance, transactional leadership ensures that employees have the tools they need to complete their jobs and links job performance to worthwhile rewards to enable firms more effectively accomplish their current goals. leaders with an eye on the future south asian review of business and administrative studies vol. 4, no. 2, dec 2022 119 create a strategic vision for that condition, convey that vision through metaphors and frames, serve as examples of that goal by acting consistently, and foster dedication to that vision (masryherzallah & stavissky, 2021). transformational leadership style and organizational performance transformative leadership's key objectives are to uplift followers and consider their needs. managers that place a high focus on transformational leadership actively monitor the complete value systems, morals, abilities, and motivation of their team members. the excellent communication skills of transformational leadership enable followers and leaders to have a thorough understanding of one another's motivational levels, values, and interests. transformational leaders motivate their people to think beyond their own interests. the charismatic abilities of transformational leaders, their ability to meet the emotional demands of their followers, and their ability to engage their followers' brains are just a few of the many aspects that contribute to their effectiveness (alatawi, 2017). a self-defining and gratifying relationship with a person or group defines transformational leaders. transformational leaders' ideological and behavioural charm persuade people to relate with them. people perform better overall in environments where they feel happy thanks to a transformative leader's individualized relationships. as a result, it is possible to assert that there is a positive relationship between transformational leadership and organisational performance (milhem et al., 2019). performance of the organisation is highly impacted by transformational leadership style. the effectiveness of an organisation is significantly influenced by its leadership principles. the many forms of leadership styles are related to performance and organisational culture. to exploit the creative environment and enable employees to work creatively, transformational leaders motivate and empower their followers to take calculated risks and own their outcomes. furthermore, transformational leaders encourage their staff to find alternate ways to complete their tasks in order to produce unique and creative ideas (lappalainen et al., 2020). several studies have found a favourable and significant association between transformative leadership and organisational success (fan et al., 2017; top et al., 2020). leaders must provide information through modelling learning behaviours in order to inspire staff to create new concepts. organizational innovation greatly benefits from the intellectual stimulation and inspiring motivation of leaders. with a vision that inspires employees to perform creatively, which leads to organisational success, leaders with transformational leadership skills foster creativity. numerous studies have provided empirical support for the beneficial association between these leaders and innovation (shafi et al., 2020). transformational leadership in educational institutions transformational leaders have the power to change an organization's employees and culture. leaders that employ transformational leadership techniques bring about admirable changes within an organisation. in order to prepare principals to use accountability and achievement data to drive instruction, serve as an instructional coach, challenge the status quo, motivate and mentor staff, manage personnel, deal with disruptions in and out of the school, and comprehend the impact of economic, social, technological, and global change on education, transformational leadership practices must be taught to principals in universities and alternative preparation programmes. leadership programmes must adapt their curriculum and programmes to meet the growing demands of the principal ship. leadership programmes should use a curriculum that contains a set of specified leadership behaviours (nuel et al., 2021). transformational leaders who are competent and gifted are crucial to the success of change efforts. high-performing school principals generate positive change in their organisations by establishing trust among stakeholders and fostering a healthy school culture. principal leaders create their culture by highlighting victories, disseminating success tales, and reiterating established standards and principles. in highperforming schools, school leaders enhance the environment, the drive, and the productivity of the south asian review of business and administrative studies vol. 4, no. 2, dec 2022 120 teachers and employees, which changes the organisation (tintoré, 2019; madjid & samsudin, 2021). transformational leadership and teacher’s performance the effectiveness of teachers is directly correlated with the leadership of a school's principal. a mediator is deemed to be a leader. they have the capacity to empower and train teachers to improve educational initiatives (top et al., 2020). to accomplish corporate objectives, the transformational leadership style emphasizes enhancing followers' intellectual growth, selfconfidence, sense of team, and excitement. transformational leadership emphasizes information sharing among employees. the goal of transformational leadership approach is to infuse the company with change and creativity. teachers value transformational leadership approaches in principals, and they see these leaders as role models who instill confidence in the school community (khan et al., 2021). teachers are more satisfied with their educational environments when administrators exhibit transformational leadership, especially when it takes the form of tailored thoughtfulness that fosters an amicable and reliable connection between teachers and principals. teachers highly evaluate principals who exhibit transformational leadership traits because they frequently provide teacher support, encourage introspection, and are thought to be great student disciplinarians who are focused on raising responsible children. teacher commitment is improved when principals exhibit transformational leadership, particularly the transformational leadership traits of intellectual stimulation and vision creation (devi & subiyantoro, 2021). transformational leadership techniques improve teacher internal states and improve student success in reading and math. teachers' internal states improve, which raises school performance and student progress. individualized assistance is one transformative leadership strategy that encourages student accomplishment more than others. it has been discovered that transformational leadership behaviours have a beneficial impact on teachers' motivation to work towards enhancing their instructional strategies and classroom management abilities (madjid & samsudin, 2021). ahmad & rochimah, (2021) stated that recognizing the requirement for soothing leadership behaviour allows for the optimum performance development. this is due to the ability of a headmaster to shape the performance of schools and become a source of influence in life and at school. a principal's innovations and teachers' performance are directly related (aguas et al., 2017). tambingon, (2018) backed up this study by claiming that principal leadership influences certified instructors' performance. nicdao, (2019) identified that incorporating such elements impacts not only the individual but also the group they lead in order to operate best. a leader's actions will generally have an impact on their followers. majeed & jamshed, (2021) demonstrated in their study how a principal's transformative leadership may inspire his or her team to go above and beyond the call of duty. this is in line with the findings of madjid & samsudin, (2021) study, which showed that transformational leadership significantly and favourably impacts teachers' performance. in another study, hai et al., (2021) showed that invention and explanation fundamentally demonstrate that a school principal's leadership successfully improves teacher effectiveness. this is not distinct from the leader's policy of teacher empowerment. how does transformational leadership style effect on an educational institution? a transformational leader can affect the educational institution by adopting the following steps: develop and follow a vision the vision is the most and important and key factor for the development of an educational institution. every teacher should support the school's vision since it is a statement about how the educational institutions will develop in the future. to develop the vision, a leader must assess the educational organisation they are in charge of. to develop the vision to eliminate the shortcomings, they must assess the institute's deficiencies (atan and mahmood, 2019). a vision needs to be south asian review of business and administrative studies vol. 4, no. 2, dec 2022 121 fueled by drive, optimism, and lofty objectives. vision indicates that the leader is aware of the fundamental principles, primary functions, and desired outcomes of the company. teachers might be motivated by vision to do particularly well. the head of the school will exhort everyone on staff to align their attitudes with the mission. the identification and analysis of several short-term or micro activities are required while creating the vision of an educational institution. finding these micro tasks are crucial because by observing how they are carried out, a leader can start to analyze institutional leadership from a different perspective than what it is and how it will be incorporated into the curricula, cultures, attitudes, and energies of the educational institutions. the mission statement for the educational institutions will be created by the vision (baba, 2022). to complete the assigned task, the leader must be able to sway the entire workforce. idealized influence is the term used to describe charismatic behaviours by leaders that are based on their beliefs, values, and sense of purpose. the mission and vision are explained in depth to the whole team by transformational leaders, who also serve as an interpreter of the purpose and vision. people want to follow a leader that is driven, has a distinct vision, and communicates the purpose to others effectively. people want to follow a leader they can connect to; therefore, charisma clearly plays a part in drawing them to the objective. the goals and particulars of the educational institution are contained in the mission. the educational institution is divided into smaller systems like an organism. each little system has to have a goal that ties back to the institute's aim. the transformative leader must divide the educational institution into smaller groups and engage each one individually (berkovich and eyal, 2021). collecting and analyzing the data for an educational institution to develop, data collecting is crucial. the leader must understand what is functioning, where there is room for improvement, and what kind of progress programmes are making inside the educational institution. the manager has to examine the last three to five years of data and assess any increases or decreases in test results. the institute's leader must determine if it has been rezoned or whether the teachers have not been performing to expectations in the classroom. the next stage is to implement the plans and gather the data once the data plans have been formed inside the educational institutions (duyan and yildiz, 2020). teachers must work together to collect the data and put in effort to enter it correctly. the institutional leaders' next step is to assess the data and decide whether or not programmes are necessary based on their analysis. making continual, little adjustments to how data is gathered or utilized is the ultimate phase in data analysis. data may be a crucial tool for transformational leaders as they create learning communities inside educational institutions. the window into a student's academic success can be provided via data (masry-herzallah and stavissky, 2021). building a positive educational culture mukhtar et al., (2020) discovered in a study that principals' and instructors' attitudes establish an environment for learning, also known as institutional climate, which determines its efficacy. they also demonstrated that trust, shared vision, and openness foster favourable school climate conditions. according to freihat (2020), institutional leaders must provide teachers the freedom to create a supportive atmosphere by fostering professional learning communities, holding them to high standards, and providing them with resources, planning time, professional development, and mentorship programmes. the institutional management must comprehend the makeup of its faculty, their origins, their demands, and how to inspire a workforce. the institutional culture is the rhythm that parents, children, and instructors follow. the leadership of the educational institution controls this. it is crucial to have a leader that supports establishing parental support networks (hambali and idris, 2020). to develop collaboration among the school, family, and community, it is vital to establish links between parents and the school; this may be a means to reduce school punishment and enhance student conduct (jameel and ahmad, 2019). numerous south asian review of business and administrative studies vol. 4, no. 2, dec 2022 122 studies have found that having a strong transformational leader who fosters collegial support, community support, and support from all stakeholders is crucial for bringing about meaningful change in educational institutions (milhem et al., 2019). engage the community there are many ways to connect with the community to ensure the success of educational institutions. to mobilize the community, the leader must set up community socials on institutional grounds. by recognizing the diversity and culture of those who reside in the community and celebrating in such a way, the transformational leader may engage the local community (supermane, 2019). collaboration is more than just making good friends; it's about creating strong, productive working relationships. building ties with the community that will last for a long time is crucial. the institutional leader should think about creating a community based on institutional principles. when working with children who have extenuating circumstances, it's critical to have a structure in place for supporting families (ullah, 2018). the organization's head needs to recruit smart locals to work as volunteers in the school's faculty. the coordinator should look for outside funding through grants available for community initiatives (tambingon, 2018).transformational leaders can contribute to the strengthening of family educational cultures by promoting trust and communication between families and educational institutions, assisting in the provision of resources to families, educating and supporting families on issues related to parenting and institutions, and adjusting institutional practices to accommodate the educational cultures that families do have. these programmes are intended to foster and sustain communal culture. it is an outreach that communicates knowledge enrichment and a better degree of education. it establishes that education is the key to global prosperity (zacharo et al., 2018). developing the teachers and staff staff development and empowerment is an important aspect in the growth of educational institutions. the majority of the instructors have been retained and should be professionally trained. creating a professional learning community requires selecting the correct staff development programmes. there will be money in the institutional budget for development, and the institutional leader must properly balance the budget and choose the finest seminars for their instructors. they must also look for extra awards and seminars offered by local colleges (ndlovu et al., 2018). the environment of educational institutions itself has a role in staff development as well. the workers and instructors must all comprehend the processes put in place by administration at the same level as the transformational leader. the purpose and vision should be considered while developing the systems, and the teachers should be made fully aware of them. to keep teachers informed on institutional achievement, data, statistics, and what they can do to improve themselves as instructors, educational institution leaders must seize every chance they get to communicate with teachers. every meeting should involve a reevaluation of the teacher's motivation, which will result in the teacher's growth (milhem et al., 2019). empowering the teachers and staff the manager must be able to provide their personnel the authority to make choices for the educational facility. the precise actions included in this group are focused on creating an environment at work where instructors may maximize their talents, commitments, and motivations. it provides them a sense of entitlement to the institution and a measure of authority when the leader encourages their workers and professors (mufeed, 2018; nicdao, 2019). the instructor will feel that because everything is on them, the goal needs to be accomplished correctly and quickly. the instructor will probably exhibit a strong feeling of pride in their goals and a sense of commitment to the initiative. the leader is in charge of making sure that everything is in order and that the goal is progressing as intended. the teacher's goal must align with the school's purpose and vision (jovanovica and ciricb, 2016; kalsoom et al., 2018) transformational leaders may set south asian review of business and administrative studies vol. 4, no. 2, dec 2022 123 standards for high-quality pedagogy and encourage teachers' professional development by challenging them to reevaluate their preconceptions about their work and the teaching process. whether a teacher is fired, moved, or demoted to a position, an institutional leader must make the proper staff modifications. by encouraging organisational stability and bolstering the institution's infrastructure, the specified activities are intended to provide productive working circumstances for instructors. the specific techniques include staffing the teaching programme, offering assistance for the classroom, keeping an eye on institutional activities, and protecting personnel from interruptions during work. a leader wishes to transfer their instructors to a new location where they would face challenges and be inspired to perform well (lappalainen et al., 2020). engaging the students when the leader has complete control of the school, the curriculum is another area that requires special attention. the institutional leader must develop objectives for students to attain in the classroom with the assistance of instructors, staff, and department leaders. this success can be attributed to thinking outside the box and deviating from established teaching practices (ali et al., 2019). giving children a more hands-on approach to learning might be advantageous. leaders of educational institutions urge instructors to be innovative and educate outside of the classroom. it is critical for students' success to be actively involved in the classroom. many student disturbances have been demonstrated to originate in the classroom and end up in the office with a referral. there are several key factors to developing a learning-friendly school culture (alatawi, 2017). ahmad and rochimah (2021) discussed the process of establishing a professional learning community for educational institutions as a whole, a community centered on student accomplishment. according to ahmad & saad (2020), teachers, administrators, and other stakeholders who are committed in the child's education must work together in a collaborative effort and bear responsibility for all kids' learning. teachers must grasp the significance of building a learning environment at the institution that will engage students in active learning. creating a student-centered atmosphere is an excellent method for minimizing suspension rates and attaining high-quality classroom management practices. the transformational leader has the ability to utilize the resources for creating conducive learning environment for the students so that they can highly engage in the learning process and can achieve higher academic achievements discussion in order to guarantee that firms are customer-centered, dynamic and effective leadership must develop a vision and an action plan. it also must foster an atmosphere where employees may be creative and productive. transformational leadership is becoming more significant and visible at all organisational levels. since talented teams will boost production for the organisation, leaders should understand how to empower subordinates. transformational leaders inspire others by satisfying and amplifying the needs of each of their subordinates via personalized appreciation, intellectual simulating, and exploring for new sources of learning. as a result, the effectiveness of the transformational leader depends on determining the appropriateness and congruence between individual and organisational requirements (tintoré, 2019; khan et al., 2021). in order to improve quality of life, efficiency, and performance in many situations, transformational leadership entails having an effect on the development and transformation of people, groups, and organisations. therefore, at the organisational, group, and individual levels of organisational behaviour, leadership is crucial. transformational leaders place a strong emphasis on key behaviours, such as inspiring their teams to set ambitious objectives and providing them the assurance they require to live up to expectations and reach their full potential. transformational leaders encourage their subordinates to participate more fully in their job. this involvement leads to higher efficiency and happiness, which leads to better management and organisational performance. a number of organisational outcomes are favorably connected with transformative leadership (buda and ling, 2017; baba, 2022). south asian review of business and administrative studies vol. 4, no. 2, dec 2022 124 in past investigations, researches established the positive connection between transformational leadership and job success. a shared understanding of the objectives and performance standards of the company is inspired and made possible by transformational leaders (majeed et al., 2017; ahmad and saad, 2020). a transformational leader motivates followers by setting an example, motivating by example, challenging the mind, and taking into account the particular needs and objectives of each follower. as a result, success on a personal, group, and organisational level surpasses expectations (sihombing, 2020). transformational leaders are prepared to build groups and provide them with strength, as well as to lead and guide them through the procedures of advancement, notably hierarchical learning. this review study was conducted to find the answer of a question that “how does transformational leadership style improve the organizational performance? the case of educational institutions”. the review of the previous studies indicated that transformational leadership style greatly affect the organizational performance. the transformational leadership style improves the performance of individual teachers and students and build the learning community in an educational institution by establishing vision and creating a conducive learning environment to achieve the predefined goals and objectives of the institute. conclusion transformational leadership changes the fundamental ideas and attitudes of an organization's workforce in order to achieve its goals. a 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(2014). the impact of transformational leadership on employee voice behavior: the role of organizational identification and procedural justice. international business and management, 9(2), 168-172. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 128 south asian review of business and administrative studies vol. 2, no. 1, june 2020 35 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas relationship between social media and employees job performance: mediating role of job engagement adnan arshad, managing director, adnan flour mill, pakistan rabia raheed, iqra university, pakistan article details abstract history revised format: may 2020 available online: june 2020 keywords sm addiction, perceived information overload, cognitive fatigue, job engagement, and job performance social media usage, if out of context and non-work related and only for personal use, becomes an addiction along with information overload is considered as an integral part. success and failure the work have and motivation of an employee at the workplace which in turn affects the job performance of employees negatively. in our study, we have tried to analyze internal and external contingent factors that affect the use of social media. our study has utilized contingent factors perceived sm addiction, perceived information overload, and cognitive fatigue. we have used survey-based research. data collected through an online questionnaire along with public sectors. we collected data of 173.by using conservation of resource theory results depict that perceived information overload and sm addiction have significant relation on social media. this shows that the external contingent factor has stronger relation to sm adoption in social media. imperative data on the relationship shared by the sma, cf, and iol with job performance within the sight of job engagement. social media are significant for survival. the primary target of this examination is to look at the relation s of social media usage also its effect on an individual’s performance on the job. to uncover this, we need to look upon the theory of conservation of resources which implicates that the employees are proactive in conserving their resources that helps them in performing their day to day task, whether it be a work environment, tools used for task performance or personal energy. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: adnanarshad1990@gmail.com doi: https://doi.org/10.52461/sabas.v2i1.441 introduction the primary target of this exploration is to examine the function of job engagement (je) as a mediator in the relationship shared by sma addiction, perceived information overload, and cognitive fatigue as independent variables with job performance in a work setting as a dependent variable. social media usage, if out of context and non-work related and only for personal use, becomes an addiction along with information overload, becoming a hindrance in scrutinizing the https://journals.iub.edu.pk/index.php/sabas mailto:adnanarshad1990@gmail.com https://doi.org/10.52461/sabas.v2i1.441 south asian review of business and administrative studies vol. 2, no. 1, june 2020 36 incoming information from being either useful or useless and cognitive fatigue slows down the work have and motivation of an employee at the workplace which in turn affects the job performance of employees negatively. the primary target of this examination is to look at the relation of social media usage also its effect on an individual’s performance on the job. to uncover this, we need to look upon the theory of conservation of resources which implicates that the employees are proactive in conserving their resources that helps them in performing their day to day task, whether it be a work environment, tools used for task performance or personal energy. the general idea here is to clarify the effect of social media addiction(sma) and information overload (iol) along with cognitive fatigue (cf) affecting the performance of an individual at the workplace and how the individual responds to these effects (zivnuska, carlson, carlson, harris, & harris, 2019). several social media networking app users are of the view that such applications help improve communication within the organization, thus, improving the overall productivity at work and making it more efficient than through the conventional modes of communication(hwang, hong, tai, chen, & gouldthorp, 2020). this helps an individual in remaining active and online most of the time by staying in touch with colleagues, saving time, and improving response time to tasks asked to be performed, diminishing the slack time as a result of better communication with colleagues and subordinates. but it is also experienced that information overload becomes a source of interruption for individuals to engage in the job and ultimately affects the job performance of an individual. the awareness built among people about social media users is there is a greater perception of sm usefulness leads to better productivity and job engagement however cognitive fatigue response to social media overuse and addiction could act as a hindrance in job performance and engagement. it is widely observed in different business sectors whether it be industrial, banking, teaching, or textile, the employees in organizations are more social media prone these days which affects their job performance and ultimately the overall performance of an organization and its profitability. thus, the issue states that social media addiction and information overload diminishes the efficiency level of employees at the workplace. not much consideration has been assumed on the usage of social media and their effect on the employee's performance in the banking sector of pakistan. this research will help understand the role of job engagement as the predictor in the relationship shared by social media usage, fatigue, and information overload with the performance of employees in the banking segment of pakistan. literature review social media addiction (sma): web-based media usage has become an integral component of our lives and the most affected people in the world from it are mostly adolescents and young adults (marengo, poletti, & settanni, 2020). social networking, nowadays, is a source of maintaining their contacts with friends and family and also improve their knowledge network along with finding and sharing information and resources, also helping them in building up a social identity which in turn helps them in creating goodwill amongst peer groups and social settings allowing them to boost their popularity in that particular social setup making them feel a sense acceptance of belonging (badenes-ribera, fabris, gastaldi, prino, & longobardi, 2019; barker, 2009). (zivnuska et al., 2019), distinct social media addiction (sma) is defined as "the constant utilize and unreasonable observing of web-based media, showed in enthusiastic utilization that comes to the detriment of different exercises". social networking has become inescapable and is sweeping into the workplaces rapidly. social media can be used in a positive way to coordinate with and correspond to various workrelated tasks and colleagues (zivnuska et al., 2019).addiction to internet usage has been one of the greatest concerns at the workplace by the organizations as it has been observed to have estimated addiction rates of 7%, 8.2%, and 1.5% in asia, the usa, and europe respectively. social media usage is found to be very supporting that it is used to interact with people online and attract their response and feedback ultimately turning into a habit of monitoring activities and behaviors. south asian review of business and administrative studies vol. 2, no. 1, june 2020 37 the researchers have indicated that social media usage is seen more in the youngsters who are more prone to fear of missing out so that they can compensate with their psychological need for social connection (oberst, wegmann, stodt, brand, & chamarro, 2017). this also indicates that people with higher fomo level are more at the risk of social media addiction (al-menayes, 2016; blackwell, leaman, tramposch, osborne, & liss, 2017; dhir, yossatorn, kaur, & chen, 2018; franchina, vanden abeele, van rooij, lo coco, & de marez, 2018). several types of research have also proposed that fomo harmst he mental health and emotional well-being of these social media addicts and adverse effects on individual's health (milyavskaya, saffran, hope, & koestner, 2018). regular social media usage is considered to be normative, but results show that excessive social media usage can become a social addiction (marino, gini, vieno, & spada, 2018; ryan, chester, reece, & xenos, 2014). social media addiction can be distinct as an excessive attachment to social media (błachnio, przepiorka, & pantic, 2016) that can lead to several negative results, as well as weakening the academic and work efficiency (karaiskos, tzavellas, balta, & paparrigopoulos, 2010; paul, baker, & cochran, 2012), social difficulties (elphinston & noller, 2011), and variability of indicators of suffering (frost & rickwood, 2017; marino et al., 2018). in the previous study there is a limitation examining links of sma on excessive dependence on reports concerning of social media activity, which are identified to be prejudiced as (junco, 2013). looking at our research the social media addiction (sma) and the interplay of it with social media activity and personality traits is an intriguing one new to the world. a few explore have additionally recommended that fomo negatively affects psychological wellness and passionate prosperity of these web-based media addicts and antagonistic relations on people wellbeing (milyavskaya, saffran, et al. 2018). in possibility, the satisfaction of these needs triggers the prize base framework, fortifying consistent facebook utilization, and potentially causing web-based media fixation (sma) (meshi, morawetz et al. 2013, duke and montag 2017). online media fixation can be unmistakable as an over the top connection to web-based media (błachnio, przeiolrka, et al. 2016) that can prompt a few negative outcomes, just as debilitating the scholastic and work proficiency (karaiskos, tzavellas, et al. 2010, paul, baker, et al. 2012), social troubles (elphinston and noller 2011), and inconstancy of markers of misery (frost and rickwood 2017, marino, gini, et al. 2018). the scientists have discovered that prior discoveries have uncovered steady associations among sma and neuroticism, results concerning extraversion are various (blackwell, leaman, et al. 2017, marino, gini, et al. 2018). in the past examination, there is an impediment analyzing connections of sma on over the top reliance on reports worried of online media activities, which are recognized to be biased (junco 2013). perceived information overload (iol): in the situation of information overload (iol), a decision-maker features what simon identified as ‘‘an abundance of data which makes a destitution of consideration and a need to dispense that consideration efficiently among the excess of data sources that may expend it’’ (roetzel, 2019). it is often observed that the banking staff is faced with information overload as they receive a lot of messages that are work-related or nonwork-related and they are faced with the challenge of scrutinizing the important messages from unimportant ones, often overlooking the important ones in this practice (hwang et al., 2020). in social science’s study, iol usually mentions a condition in which an individual recognizes a disproportion amid ecological stresses and the accessible incomes to react to and deal with person requirements (eppler & mengis, 2008). the increase in social networking websites and also the saturation of smartphones in approximately all parts of life have essentially altered the quantity of information that individual’s procedure on a regular day. in this respect, the question that arises is whether what part does information overload (iol) play in the work-related social media usage as the positive relation of work-related social media on job performance has already been proved. south asian review of business and administrative studies vol. 2, no. 1, june 2020 38 maximum researches have examined solitary conclusions of social networking sites usage or information overload, such as anxiety (chen & lee, 2013; lee, son, & kim, 2016) or unhappiness (primack et al., 2017; shensa et al., 2017). most extreme investigates have inspected lone finishes of social networking sites use or information overload, for example, nervousness (chen and lee 2013, lee, son, et al. 2016) or misery (primack, shensa, et al. 2017, shensa, escobar-viera, et al. 2017). cognitive fatigue (cf) cognitive or physiological and psychological fatigue that is also known as reduced attentiveness is well researched and document in the past, and irrespective of the differences among individuals (killgore, 2010; satterfield & van dongen, 2013). fatigue can be distinct as the “inability to work at one's ideal level because physical and mental effort (of every single waking movement, not just work) surpasses existing capacity” (gander, briar, garden, purnell, & woodward, 2010). the deficits related to cognition may include slowing, failure inattentiveness, low level of memory recall, negative effect on decision making, less awareness regarding the current situation, loss in creativity and innovation levels, mistakes in performing tasks, and more prone to accidents. the deficits related to behavior may include being inactive physically, non-responsive actions that are ineffective in the current situations, poor risk calculation that makes the person either high-risk taker or risk averter, both being hurtful for task performing, overreactions over peoples provocative behavior, being easily distracted by surroundings from a task, low levels of communication both quality-wise and in some areas, quantity-wise, and being drowsy and falling asleep during work hours unintentionally. such and many other effects of fatigue have been pointed out and discussed in the researches done before and a lot of reviews have been written on fatigue (durmer & dinges, 2005; killgore, 2010; pilcher & huffcutt, 1996). fatigue because of social media usage is considered to be the chances of backing away from social media used primarily concerning the overflow of non-work-related information and interactions that includes content, social interactions with online friends through social networking sites and entertainment related websites and contents (technopedia, 2011). cognitive fatigue includes problems such as loss of memory and lack of concentration and distraction during the time taken in performing the tasks at hand (hwang et al., 2020). our research includes the relationship of cognitive fatigue and job performance considering job engagement to be proven as negative. job performance (jp) job performance points out the excellence of the work carried out by an employee (caillier, 2010). job performance is related to the aptitude of the employees being well aware of targets assigned, satisfying expectations, and accomplishing targets or achieving a typical set of assignments for the organization (sethela & rosli, 2011). job performance has been a vital part of research in the field of human resources and business administration. (johari, shamsudin, yean, yahya, & adnan, 2019) characterized job performance (jp) as the capacity of an individual to perform tasks in available resources at the workplace. according to (johari et al., 2019), there are three constituents of job performance these includes environment, motivation, and ability. the environment provided by an organization plays a key role in allowing an individual to perform the task at hand. motivation is another key factor as the individual requires self, along with the organizational supported motivation to better perform the tasks allotted to one. finally, the individual can identify, summarize and solute the problems or hindrances that keep one away from solving the issues in performing the said tasks. together, these three factors let an individual boost one’s performance at a job and accomplish the targets in a better more comprehensive manner. the relation of social media addiction, information overload, and cognitive fatigue could relation negatively to the job performance of an individual. the interruption of job engagement as a mediator in the aforesaid relationship is the focus of this research. south asian review of business and administrative studies vol. 2, no. 1, june 2020 39 a lot of factors that may be internal or external can affect on job performance of employees or the success of employees in the organization. individual capacity, skill, and knowledge can be instances of internal factors whereas the characteristics, working environment of assigned tasks, organizational structure, incentive, and human resource management practices are instances of external factors (lu, guo, luo, & chen, 2015; supriyanto & maharani, 2015). several types of research have scrutinized the magnitude of employees’ job performance as task performance, adaptive performance, contextual performance, agility performance, creative performance, and effectiveness (çatalsakal, 2016). job performance is directly correlated to the technical features of an organization and it maintains the center of any organization both by carrying out its procedures or sustaining its services required (harari, reaves, & viswesvaran, 2016; üryan, 2015). use of social media on the place of work may pessimistically affect the performance on job (vahle-hinz, mauno, de bloom, & kinnunen, 2017). for instance, social media usage on the place of work guide the employee to exploitation of official time, organizational resources, and has often been professed as an employee diverge from the place of work, breaching the standard procedures of operation of the organization. as a result, social media deteriorate the employee performance on job. on the other hand, scholars consider that practitioners can enhance the effectiveness and efficiency of the employees by implementing social media in business procedures (levy, 2013). the utilization of online media in the work environment may negatively influence the presentation on work (vahle-hinz, mauno, et al. 2017). for example, online media utilization in the work environment direct the worker to misuse authentic-time, hierarchical assets, and has frequently been purported as a representative veer from the work environment, breaking the standard strategies of activity of the association. therefore, online media break down the representative execution of work. then again, researchers consider that experts can improve the adequacy and effectiveness of the representatives by executing online media in business strategies (levy 2013). the primary reason for this exploration is to analyze the relation s of online media use and its consequences for a person's exhibition on work. the overall thought here is to explain the effect of online media dependence and data over-burden alongside intellectual weakness affecting the execution of a person in the working environment and how the individual reacts with these relations (zivnuska et, al, 2019). very little consideration has been given to the use of online media and its consequences for the exhibition of representatives in the financial area of pakistan. this examination will help comprehend the part of occupation commitment as the indicator in the relationship shared by web-based media use, weakness, and data over-burden with the execution of workers in the financial area of pakistan. social media use is discovered to be supporting that it is utilized to associate with individuals on the web and pull in their reaction and input eventually transforming into a propensity for checking exercises and practices. it is frequently seen that the financial staff is looked by data over-burden as they get a lot of messages that are business-related or non-business related and they are confronted with the test of investigating the significant messages from irrelevant ones, regularly neglecting the significant ones in this training (m.y, hwang et. al,). in this regard, the inquiry that emerges is whether what job does data over-burden play in the business-related utilization of online media as the positive connection of businessrelated web-based media on job performance has just been demonstrated. job engagement (je) job engagement (je) is distinct as an affective and optimistic inspirational condition of businessrelated prosperity, with the distinctiveness of potency, devotion, and assimilation (petrović, vukelić, & čizmić, 2017; w. zhang, meng, yang, & liu, 2018). recent researches have focused a lot on engagement and its decomposition because of employee engagement, still, it has been loosely defined by researchers to keep it open end for others to explore a better view of employee engagement for future scholars and researchers (ewing, men, & o’neil, 2019). job engagement is a component of the construct used to define employee engagement. the other component includes organization commitment (x. zhang, ma, xu, & xu, 2019). the factors that identify job south asian review of business and administrative studies vol. 2, no. 1, june 2020 40 engagement can include job crafting, job hindrance, job satisfaction, and job resources. it also considers intra organizational social connections. job engagement is unmistakable as a full of feeling and idealistic motivational state of business-related flourishing, with the peculiarity of power, dedication, and osmosis (petrović, vukelić, et al. 2017, zhang, meng, et al. 2018). a corelational and cross-sectional study of a hospital in portugal discovered the mediating effect of job engagement between job satisfaction, turnover intention, and social support (orgambídez-ramos & de almeida, 2017). the value of job engagement in this research is vital as it acts as a mediator in the model and mediates the relationship shared by social media addiction, fatigue, and information overload with job performance and lets us realize its effect on their relationship to be either amplifying or diminishing. thus, providing vital information on the relationship shared by the sma, cf, and iol with job performance (jp) in the presence of job engagement (je). h1: social media addiction is negatively related to job engagement h2: perceived information overload is negatively related to job engagement h3: cognitive fatigue is negatively related to job engagement h4: job engagement is positively related to job performance h5: sm addiction is negatively related to job performance through job engagement h6: perceived information overload is negatively related to job performance through job engagement. h7: cognitive fatigue is negatively related to job performance through job engagement methodology the study used cross-sectional, quantitative approach and simple random sampling to collect data. a primary data information source was utilized and 250 questionnaires were distributed through an online questionnaire and 173 responses were collected from public segment banks located in south punjab, pakistan. the test was taken from 5 public sector banks operational in bahawalpur locale to be specific, national bank of pakistan, bank of punjab, zarai taraqiati bank limited, punjab cooperative bank and state bank of pakistan. the spotlight in this examination was on public banks including the trainees, first-line supervisors, and center level administration of the banks. figure 1: conceptual framework of the study south asian review of business and administrative studies vol. 2, no. 1, june 2020 41 table 1: demographic profile respondents demographic profile frequency percentage gender male 129 74.6 female 44 25.4 age 20 to 25 53 30.6 26 to 30 64 37.0 31 to 35 30 17.3 36 to 40 13 7.5 above 40 13 7.5 experience 1 to 3 years 61 35.3 3 to 6 years 56 32.4 6 to 9 years 22 12.7 above 9 years 34 19.7 marital status un-married 102 59.0 married 71 41.0 to access social media addiction, questionnaire was adopted from the study of (sahin, 2018). to access information overload, questionnaire was adopted from the study of (williamson, eaker, & lounsbury, 2012). to access cognitive fatigue, questionnaire was adopted from the study of (shahid, wilkinson, marcu, & shapiro, 2011). to access job engagement, questionnaire was adopted from the study of (rich, lepine, & crawford, 2010). to access job performance, questionnaire was adopted from the study of (cetinkaya & rashid, 2018). findings & discussion spss and pls programming are utilized to test the reliability of the information and affirm the theories. cronbach's alpha was utilized to test the reliability of the survey. factor analysis and regression analysis is likewise done. factor analysis is done to distinguish the basic build for a variable set alongside these we have broken down the demographics of the respondents. following measurable methods were applied to investigate the information accumulated through the study: descriptive statistics, correlation analysis, and multiple regression analysis. factor examination is one of the significant strides in information investigation, principally intended to comprehend the basic measurements or proposed dimensionality of factors in a proposed model or connections in observational exploration (hair, anderson, tatham, and black, 2002). the accompanying areas talk about the after effects of factor examination utilizing head south asian review of business and administrative studies vol. 2, no. 1, june 2020 42 segments with varimax revolution strategies. the models used to recognize the variables are that eigen value must be more noteworthy than 1 and that they each have in any event 1 thing to guarantee solidness. reliability: the unwavering quality of the instrument utilized in this examination was tried utilizing cronbach's alpha utilizing the pls-sem model. with the end goal of this examination, a base unwavering quality (that is cronbach's alpha) of 0.70 was set as proposed by hair jr, ringle, and sarstedt (2013). as appeared, the cronbach’s alphas of the measures were all serenely over the lower furthest reaches of agreeableness that is α > .50. thus, all the measures were exceptionally solid. ultimately, in this investigation, outer factor loading as a significant measure in evaluating the marker's commitment to dole out constructs were analyzed. outer loadings were inspected dependent on the limit estimation of 0.50 or more (hair jr, black, babin, anderson, & tatham, 2010). in any case, hair jr et al. (2013) focused on that outer loading more prominent than 0.40 however under 0.70 ought to be deliberately investigated and ought to be erased just if it increases the estimation of cr and ave. considering these suggestions concerning item deletion. unwavering validity and reliability are the two primary rules utilized in pls-sem investigation to assess the external model (hair jr et al., 2013). the decision about the idea of the relationship among constructs (inner model) relies upon the reliability and validity of the measures. the appropriateness of the external model can be surveyed by taking a look at (1) singular item reliabilities, therefore indicator reliability and inside consistency unwavering quality utilizing the composite reliability (cr); (2) convergent validity of the measures related with singular constructs utilizing normal change extricated (ave); and (3) discriminant validity utilizing fornell and larcker (1981) criterion and the indicator's external loadings. in the first place, internal consistency typically gauges the consistency of result between things of a similar test. it estimates whether the proposed items estimating the constructs are delivering comparable scores (hair jr et al., 2013). thusly, in this investigation, inward consistency unwavering reliability was evaluated by analyzing cr. subsequently, in this investigation, cr and cronbach's alpha values of all the constructs were inspected, and the outcomes shows that all cr and cronbach's alpha values surpass the suggested limit estimation of 0.70 (hair jr et al., 2013; henseler, ringle, & sinkovics, 2009). next is the convergent validity, which indicates the degree to which proportions of similar constructs that are hypothetically identified with one another are connected (henseler et al., 2009). henceforth, it shows the level of the relationship among the proportions of similar constructs (hair jr et al., 2013). concerning recognizing a component or assembly in the estimations of the construct, ave is utilized with a limit value of 0.50 or more (hair jr et al., 2013; henseler et al., 2009). ave estimation of 0.50 shows satisfactory convergent validity. as it were, latent constructs clarify half of the difference of its values and show sufficient convergent validity (hair jr et al., 2013). in this investigation, convergent validity was evaluated by analyzing ave values. results show that the ave estimation of the apparent multitude of constructs surpasses the edge value of 0.50 (hair, sarstedt, pieper, & ringle, 2012; henseler et al., 2009). reliability and validity cronbach' s alpha rho_a composit e reliability average variance extracted (ave) south asian review of business and administrative studies vol. 2, no. 1, june 2020 43 cf 0.73 0.85 0.83 0.55 iol 0.74 0.74 0.81 0.52 je 0.71 0.81 0.82 0.56 jp 0.84 0.88 0.88 0.56 sma 0.77 0.85 0.84 0.52 discriminant validity is set up when the estimation of the square base of ave of each build is higher than the develops a most noteworthy connection with some other latent construct (hair jr et al., 2013; henseler et al., 2009). along these lines, in this examination, discriminant validity was surveyed by contrasting the square base of the ave for each development with the relationships introduced in the connection framework. table shows the consequences of fornell and larcker (1981) criterion evaluation with the square base of the constructs. the square root of ave in striking is more noteworthy than its most elevated constructs relationship with some other constructs. subsequently, it is reasoned that discriminant validity on the construct has been set up (hair jr et al., 2013; henseler et al., 2009). fornell-larcker criterion cf iol je jp sma cf 0.74 iol 0.19 0.72 je 0.76 0.24 0.75 jp 0.32 0.14 0.35 0.75 sma 0.63 0.15 0.62 0.36 0.72 items’ cross loadings indicators cf iol je jp sma cf1 0.8 0.36 -0.01 0.02 0.03 cf2 0.81 0.15 0.63 0.27 0.54 cf4 0.76 0.24 0.56 0.25 0.41 cf5 0.87 0.22 0.64 0.28 0.56 cf6 0.87 0.05 0.69 0.27 0.55 iol10 0.15 0.67 0.14 0.15 0.11 iol5 0.09 0.73 0.14 0.08 0.05 iol7 0.08 0.66 0.14 0.07 0.13 iol9 0.2 0.81 0.23 0.11 0.15 je1 0.72 0.16 0.8 0.28 0.47 je2 0.55 0.17 0.83 0.26 0.53 je3 0.67 0.21 0.88 0.29 0.6 je4 0.13 0.26 0.34 0.22 0.07 jp2 0.23 0.01 0.22 0.72 0.21 jp3 0.2 0.05 0.27 0.76 0.26 jp4 0.26 0.17 0.28 0.86 0.28 jp5 0.29 0.14 0.34 0.8 0.39 jp6 0.27 0.15 0.25 0.78 0.21 jp7 0.16 0.1 0.1 0.51 0.2 sma10 0.58 0.05 0.57 0.23 0.86 sma2 0.52 0.04 0.5 0.28 0.76 sma7 0.29 0.23 0.24 0.26 0.58 sma8 0.1 0.41 0.14 0.18 0.43 sma9 0.53 0.15 0.55 0.34 0.86 south asian review of business and administrative studies vol. 2, no. 1, june 2020 44 assessment of htmt ratio items cf iol je jp sma cf iol 0.42 je 0.74 0.38 jp 0.39 0.21 0.44 sma 0.75 0.35 0.71 0.43 measurement model structural model ensuring the assessment of multicollinearity in the previous area, it was affirmed there is no multicollinearity issue among the exogenous factors. in any case, this examination reconsidered the collinearity as proposed by hair jr et al. (2013). the outcomes in table show the estimations of vif. assessment of collinearity items vif cf-je 1.67 iol-je 1.04 je-jp 1 sma-jp 1.65 evaluation of path coefficients for direct relations in light of the pls-sem calculation and bootstrapping method, shows the path coefficient of the dependent and the independent variable. the outcome uncovers that the variables have a negative south asian review of business and administrative studies vol. 2, no. 1, june 2020 45 coefficient with the endogenous variable. in the subsequent model, the mediator variable was presented, and the connection between the independent variable and the arbiter variable, just as a go-between and the dependent variable, were surveyed. assessment of path coefficient relations beta standard deviation t statistics p values results cf ---> je -0.6 0.06 9.8 0 supporte d iol ---> je -0.1 0.05 1.77 0.001 supporte d je ---> jp 0.36 0.06 6.06 0 supporte d sma ---> je -0.23 0.07 3.52 0 supporte d likewise, bootstrapping result gives an interval estimate of a population constraint that can't be gotten by utilizing other mediation tests (mackinnon, lockwood, & hoffman, 1998). knowing the upside of bootstrapping technique over different strategies, hair jr et al. (2013); and hayes and preacher (2010) recommend testing the importance of the mediation utilizing bootstrapping techniques. subsequently, this investigation tried the mediating part of je on the negative effect of cf, iol, and sma on jp offering expectation to smart pls 3.0 (ringle, sarstedt, & schlittgen, 2014) utilizing the bootstrapping method. assessment of indirect relations relations beta standard deviation t statistics p values resul ts cf ---> je ---> jp -0.22 0.04 5.12 0 supported iol ---> je ---> jp -0.04 0.02 1.56 0.12 not supported sma ---> je ---> jp -0.09 0.03 2.91 0 supported south asian review of business and administrative studies vol. 2, no. 1, june 2020 46 structural model the first section presented the examination, study objective, the exploration inquiries to be replied to, and the importance of the examination. the second chapter shows the rundown of the literature proposed by various analysts concerning the exploration done beforehand on the five factors. it incorporated the eminent work of x. zhang et al. (2019); zivnuska et al. (2019), hwang et al. (2020), ewing et al. (2019), johari et al. (2019) and others. the section examined the relationship of the factors talked about previously by these analysts. the third part furnished the calculated structure alongside the proposed theories to be tried and the exploration model for this investigation. it likewise talked about the populace and test alongside the information collection method and the strategies used to dissect the information. the fourth section broke down the gathered information to demonstrate the connections between the factors factually. to play out the examination, spss and pls were utilized and the rules of utilizing the software were accomplished from hinton and brownlow spss explained). the current section talks about the ends drawn from the investigation done in the past section. the exploration was done in the southern punjab area of pakistan and the essential reason for the examination was to test the connection between sma, cf, iol, and jp execution and above all the intervening relation of je on the connection between the factors. the results of the analysis will assist answers to the research questions of the study. each research question deals with the individual hypothesis as the first hypothesis posits that social media addiction is negatively related to job engagement. in conclusion, the results of h1 represent that social media addiction negatively relates to job engagement. hence, h1 is accepted. the second hypothesis postulated that perceived information overload is negatively related to job engagement. and by analyzing h2, it also postulated the result that perceived information overload negatively relates to job engagement and hence, second hypothesis is also accepted. moving toward h3, it hypothesized that cognitive fatigue is negatively related to job engagement and according to results cognitive fatigue also negatively relates to job engagement and third hypothesis is also accepted. the fourth hypothesis of this research postulated that job engagement is positively related to job performance and result also indicates that job engagement positively relates to job performance. south asian review of business and administrative studies vol. 2, no. 1, june 2020 47 so, this hypothesis is also accepted. h5 assumed that sm addiction is negatively related to job performance through job engagement and after analyzing the results of study, this h5 is also supported. h6 postulates that perceived information overload is negatively related to job performance through job engagement. results of this hypothesis indicated that h6 is not supported and perceived information overload does not relates negatively to job performance through job engagement. the seventh hypothesis posits that cognitive fatigue is negatively related to job performance through job engagement and according to results of h7, this hypothesis is accepted and so, cognitive fatigue negatively relates to job performance through job engagement. conclusion & recommendations the discoveries of this exploration consider the interceding factor i.e. the je to be a central participant in improving the relation of sm effect on the efficiency of any association's workers. it is prescribed for pakistani organizations to apply work commitment (je) so much that the positive effect of online media on their representative’s job performance and their results are improved to a specific level. various commitments are given in this exploration; restrictions can even now be sensed in it. the examination was done in the public sector. the outcomes might be extraordinary if the example incorporates different urban areas of pakistan all in all. the majority of the members of this exploration was the recently employed investors working in public sectors and had fewer than 20% assessment of the veteran experts who have ample experience. the primary driver for missing the accomplished expert’s opinion was that they were occupied, and the individuals who had this chance, were not approachable being a dynamic aspect of the decision-making process in their associations. this examination study is identified with the interceding relation of je and its effect on the connection between laborers jp and sma. as this investigation has not examined the functional application, the exploration in future should be possible to check whether what results in these relations achieve? sma use is a hopeful viewpoint for the laborer's execution and its adequacy. online media habit's connection with a commitment to organization and advancement of the association can be assessed. this investigation can be advanced to try out the effect of sma and weakness on a mental angle i.e. learning observation, execution examination, representatives' disposition towards objectives accomplishment, and so forth. another segment of this exploration in the future could be to see whether online media utilization and addiction can be screened as having negative relations. the purpose of this survey was to analyze the results to fulfill the objectives of this research. additionally, the foundation of research was built through definitions, explanation, nature, characteristics, and types of our variables: social media addiction, perceived information overload, cognitive fatigue, job engagement, and job performance. seven hypotheses were proposed to test the relationship among these five variables. the study was based on the crosssectional, quantitative approach, through online survey-questionnaires; data was collected from 173 employees working in public sectors in pakistan by using simple random sampling. smart pls version 3 was used to analyze the data obtained from the employees of pakistan. spss and pls programming are utilized to test the reliability of the information and affirm the theories. cronbach's alpha was utilized to test the reliability of the survey. factor analysis and regression analysis is likewise done. factor analysis is done to distinguish the basic build for a variable set alongside these we have broken down the demographics of the respondents. following measurable methods were applied to investigate the information accumulated through the study: descriptive statistics, correlation analysis, and multiple regression analysis. pls-sem techniques were used for basic analysis, and two models were performed: measurement model and structural model. the analysis of research shows significant results, and all hypotheses were accepted except south asian review of business and administrative studies vol. 2, no. 1, june 2020 48 one. moreover, limitations, the scope of the study, future recommendations and the significance of the study was also provided in detail. references al-menayes, j. 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(2019). social media addiction and social media reactions: the implications for job performance. the journal of social psychology, 159(6), 746-760. https://doi.org/10.1016/j.im.2018.12.004 south asian review of business and administrative studies vol. 2, no. 1, june 2020 52 south asian review of business and administrative studies vol. 5, no. 1, june 2023 1 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas efficacy of opt-in vs. opt-out default nudges to encourage socially responsible investing: the moderating role of financial literacy ms. khadija ashfaq, phd scholar, international islamic university islamabad, pakistan dr. abdul raheman, professor and dean, international islamic university islamabad, pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords behavioral finance, default nudges, financial literacy, socially responsible investment this study intends to investigate the impact of opt-in and opt-out default nudges on pakistani investors' decisions to make socially responsible investments, with the moderating influence of investors' financial literacy. a commercial online panel is used to gather data as part of an experiment with an incentive-based online survey. a total of n = 518 individuals is randomly assigned to two treatment groups—opt-in and opt-out—and one control group. the empirical findings of this study show that, although being less effective than the opt-out nudge effect, the opt-in nudge effect nevertheless has a considerable impact on sri decisions. the study's results also show that financial literacy moderator has partially significant impact on the efficacy of default nudges. in order to improve investment instruments that might encourage sri investment in society, sri policymakers can benefit from this study. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: khadija.phdfin62@iiu.edu.pk doi: https://doi.org/10.52461/sabas.v4i2.1831 introduction in 2015, the un adopted the sustainable development goals (sdgs) as a universal call to stimulate action in areas of critical importance. pakistan is one of the first countries to adopt and commit to the united nations 2030 agenda for sustainable development. in order to implement the un sgds, socially responsible investment (sri) can be used as a measure to promote responsible finance. sri has grown recently (nilsson et al., 2014; falcone et al., 2018), businesses now have a chance to strengthen their sustainable business models through csr initiatives. a socially responsible investment (sri) is a type of investment that fosters both meaningful societal development and solid financial returns. sri refers to the process of incorporating environmental, social, and governance (esg) considerations into investment decisions (sandberg & nilsson, 2011). in the emerging and frontier economies, sri is not popular and is still in its initial phase. they have to join this global momentum, even at the most basic level of implementation, or else they will be left behind. an effective and inexpensive strategy to encourage acceptance of sri seems to be required. choice architecture interventions have gained popularity among public policymakers over the past ten years as a way to encourage pro-social behaviour in either individuals or society as a whole. https://journals.iub.edu.pk/index.php/sabas mailto:khadija.phdfin62@iiu.edu.pk https://doi.org/10.52461/sabas.v4i2.1 south asian review of business and administrative studies vol. 5, no. 1, june 2023 2 these interventions are referred to as "nudges," which are defined as little adjustments to the choice architecture that modify behaviour in a predictable way without prohibiting or monetarily restricting any of the alternatives (thaler & sunstein, 2008). the term "nudging" refers to a broad range of strategies that all have the goal of making the desirable action the default choice. early nudge research found positive behavioural effects and other advantages of nudges as a policy instrument, including simplicity of adoption and cost-effectiveness (benartzi et al., 2017). jachimowicz et al. (2019) argued that default is the most simple and effective nudge that can be used to influence behavior. in terms of behaviour change, default nudges are among the most successful (hummel & maedche, 2019), which makes them particularly interesting in regard to how effectively autonomy is honoured. in contrast to the opt-in default, which is sometimes referred to as an express consent policy and calls for individuals to explicitly state their choices, the opt-out default holds that everyone is willing to accept the preselected option unless they expressly opt-out of doing so (etheredge, 2021). usually, frequencies are much greater in an optout system than in an opt-in system. defaults are typically regarded as the most typical example of nudging (e.g. thaler & sunstein, 2008) and have most consistently been classified as type 1 (hansen & jespersen, 2013) or non-educative (sunstein, 2016) nudges. several behavioural areas, such as sustainable behaviour (pichert & katsikopoulos, 2008; vetter & kutzner, 2016) and financial behaviour, provide examples of default effects (madrian & shea, 2001). johnson and goldstein (2003) presented a striking disparity in the percentage of citizens registered as organ donors as the most illuminating difference between having an opt-in and an opt-out system. countries that followed an opt-in approach had consent rates between 4.25% and 27.5%, but those that followed an opt-out system saw consent rates between 85.9% and 99.98%. the question of whether this variation in consent rates actually translates into greater donation rates has been contested, but the variation powerfully demonstrates the influence defaults may have on behaviour. furthermore, there are increasing issues and criticism concerning the legitimacy of opt-out default nudges. even nudges that retain a pretence of decision freedom, according to hausman and welch (2010), may reduce a person's autonomy. according to smith et al. (2013), default nudging can violate people's autonomy and their capacity to make informed decisions, even when the results are positive. according to a survey, default nudges were rated less positively and as greater threats to autonomy (jung and mellers, 2016). so, in this study, we compare the effectiveness of more manipulative and less autonomous opt-out default with less manipulative and more autonomous opt-in default. this comparison is drawn to check whether it is possible to nudge an individual without compromising on autonomy. to examine these potential trade-offs and the implications for empirical validation of default nudges designed to improve responsible investment, we conducted an online experiment comparing the effectiveness of opt-in and opt-out default nudges on share of individual who choose sri as an investment decision in a hypothetical investment scenario. agnew and szykman (2005) found that the effectiveness of information architecture vary with financial literacy of the individual. they further elaborated that individuals with low levels of knowledge are more likely than those with high levels of knowledge to choose the default allocation. carpenter et al. (2021) demonstrated that choice architecture seems to differentially assist those who have a lot at stake, poor family income, high cognitive capacity, and low financial literacy to avoid making the worst choice. few studies are available in the literature on how to identify the role of financial literacy in the effectiveness of nudges. so, we further investigate the moderating effects of financial literacy on the efficacy of opt-out and opt-in default nudges in order to understand the impact of financial literacy in this study. south asian review of business and administrative studies vol. 5, no. 1, june 2023 3 literature review thaler and sunstein (2008) define "nudge" as a component of the choice architecture that influences people’s decisions predictably without changing the incentives or constraints they face. people frequently lack the time, desire, or resources necessary to think intentionally, clearly, and logically. as a result, rather than being the outcome of logical and rational processes, most acts are the result of habits, heuristic processes, unconscious associations, or automatic and learnt responses (hofmann et al., 2009; kahneman, 2011; smith & decoster, 2000). then, nudges take advantage of flaws that affect automatic unconscious processes and passive decision-making, such as the fact that people do not fully consider their options, they tend to follow the path of "least resistance," they lack clear preferences and complete information, and choices will inevitably be influenced by defaults, framing and anchoring, to capitalize on the unconscious interaction between a person and the environment, and thus of the so-called system 1 way of thinking (sunstein & thaler, 2003; thaler & sunstein, 2008). camilleri et al. (2019) tested two interventions to improve retirement savings investment decisions by doing an experiment. they studied the efficacy of a "nudge" by maneuvering the default option and the efficacy of a "signpost" by influencing the display of a pictograph, briefing the expected return of each option. their findings suggested that both smart defaults and better risk information by using pictographs can be used to positively influence behavior. gajewski et al. (2021) examined the effect of nudges on the behaviour of investors in favour of socially responsible investment (sri) by setting up two online experiments with 713 us retail investors. by using three nudges, i.e., sri as the default investment, an sri explanation message, and negative priming ethical values by revealing shocking images, they found that the sri default option was the most efficient nudge to alter investors' behaviour towards sri. the remaining two nudges marginally increased the sri investment, but in isolation they appeared non-significant. for instance, in the area of economics, a customer may be accidentally persuaded to take the default option (brown and krishna, 2004). research demonstrates that increasing defaults caused consumers to save more for retirement and buy more insurance (johnson et al., 1993; madrian and shea, 2001). defaults frequently impact the approval of policies in the health sector, including those pertaining to organ donation and transplantation (johnson and goldstein, 2003; abadie and gay, 2006; ahmad et al., 2019). the opt-out approach has also been proposed as a successful intervention to change employee behaviour in the workplace, including stand-up working (venema et al., 2018), enrolling in pension plans (thaler and sunstein, 2008; robertson-rose, 2021), and energy efficiency (brown et al., 2013; egebark and ekström, 2016). in addition, default nudges are simple and inexpensive to apply (thaler and sunstein, 2008), making them appropriate for fostering policy support. the majority of research examined how opt-in and opt-out default options affected the health, energy, and savings and retirement areas. there have been few research on the impact of default options on socially responsible investing, and none have evaluated the efficacy of opt-in and opt-out defaults. bassen et al. (2019) provided empirical evidence for the effectiveness of climate labelling as a potential nudge for climate-friendly investing. madrian and shea (2001) discovered that automatic enrollment (opt-out default) had a significant impact on the saving behaviour of employees in large us corporations. johnson and goldstein (2003) showed that changing the default increases the rate of organ donation in europe from 15% (opt-in default) to 98% (opt-out default). in addition, defaults can have a significant impact on behaviour, with a wide range in effect sizes, according to a recent meta-analysis of default effects (jachimowicz et al., 2019). this meta-analysis revealed that when a certain choice is established as the opt-out default as opposed to an opt-in scenario, the chance of selecting it is.68 sds greater. nevertheless, the authors also found considerable south asian review of business and administrative studies vol. 5, no. 1, june 2023 4 impact size heterogeneity, which might imply moderating. the features of the study showed that default effects are smaller for judgements involving sustainable behaviour (as opposed to decisions not pertaining to sustainable behavior) and bigger in consumer domains (than in non-consumer domains). as an often mentioned example of nudges, default nudges have been employed more and more to affect a variety of societal concerns (nicolao et al., 2018; zhao et al., 2022). the opt-out default believes that all people are prepared to accept the preselected choice unless they clearly "opt-out" of doing so, whereas the opt-in default is also known as a "express consent" policy and requires people to manifestly declare their preferences (etheredge, 2021). aysola et al. (2016) compared opt-in vs. opt-out defaults in the health sector. “opt-in default nudge”, are those nudges in which participant are asked to opt-in the default sri fund (steffel et al, 2016). the explicit consent is required from a person in opt-in default system (meszaros et al., 2020). it is simply the facilitation of behavior. this type of nudge is used in another study by meske et al. (2020), where they compare opt-in checkbox nudge and force choice nudge in the form of a text box. on the basis of literature, the following relationship is expected: h1a: the opt-in nudge has a significant positive impact on sri decision of investors. meszaros et al. (2020) define out-of-the-box default as a system in which the consent of a person is automatically assumed. it falls under the category of manipulation of behavior. johnson and goldstein (2003) compare the effectiveness of opt-out default over opt-in default. the “opt-out default nudge”, are nudges in which the default sri fund is pre-selected for participants and they are asked to fill out a short form if they want to opt out of the default option (gajewski et al., 2021). default nudges are used to reduce the complexity of decision-making. the following relationship is anticipated based on the literature: h1b: the opt-out nudge has a significant positive impact on sri decision of investors. according to agnew and szykman's (2005) research, an individual's financial literacy affects how effective information architecture is. they went on to explain that people with less information are more inclined to select the default allocation than people with greater knowledge are. anderson and robinson (2018) examined how financial literacy moderated investors’ reactions to nudges. according to their findings, financially literate investors and those who believed they were not financially literate were less reactive to nudges. investors who mistakenly believed that they were financially literate were more responsive to nudges. carpenter et al. (2021) showed that people with a lot on the line, low family income, high cognitive ability, and little financial literacy appear to receive differential assistance from choice architecture to avoid making the worst decision. considering the relevant literature, the following two relationships are predicted: h2a: the financial literacy moderates the relationship between opt-in nudge and sri decision of investors. h2b: the financial literacy moderates the relationship between opt-out nudge and sri decision of investors. methodology we use a sample size of n = 518, a representative sample of potential private investors from pakistan, who are recruited through a commercial online panel and pay compensation for it. this approach of using a commercial online panel has been used in many studies, like ingendahl et al., (2020) and hainmueller & hiscox (2010). this sample size is obtained after excluding very inattentive responses and those who are uncertain about their responses. following levin et al. (2020), randomization is done through qualtrics software in this study. participants in a commercial online panel are randomly assigned to a control group and two experimental groups. south asian review of business and administrative studies vol. 5, no. 1, june 2023 5 yet, the exclusions were disproportionate, leading to three distinct group sizes: 179 (control group), 176 (opt-in), and 163 (opt-out). here, a sufficient sample size of the control group and each experimental group is employed to reliably detect treatment effects (gajewski et al., 2021; momsen & stoerk, 2014). in this study, the online survey experiment approach is used to collect data from a sample of potential private investors in pakistan. firstly, the participants have received general instructions about the importance of giving serious responses in order to ensure research quality. participants are asked to complete the hypothetical investment task of allocating pkr 1000,000 in any one investment option provided by the investment bank, as described by gajewski et al. (2021). these investment options are equity funds, sri funds, asset allocation funds, and bond funds. these options are equally efficient in terms of risk/return. the risk-return profile of sri funds is the same as that of the equity fund. in opt-in test group, participant are asked to opt-in the sri fund before presenting all choices. in opt-out test group, sri fund is pre-selected for participants and they are asked to fill out a short form if they want to opt out of the default option. in control group, there is no default option. qualitative data is collected by using an online questionnaire in the survey experiment approach. this study implements the online survey experiment through qualtrics, which is a secure webbased survey platform. the experiment is performed remotely through an incentivized web-based questionnaire. it takes almost 10 minutes to complete the questionnaire. after the initial instructions, the first question is a hypothetical investment task. after this task, participants are required to answer questions about demographics, financial literacy, risk tolerance, and social behavior. the participants are asked to answer the closed-ended questions on the given scale in the questionnaire. the data is qualitative and comes from interventional nudges. it is quantified by assigning dummies to each nudge. the variations in features and other factors are statistically controlled when individuals are randomly allocated to several treatment groups and a control group (momsen and stoerk, 2014). using a kruskal-wallis test, the randomization effect is examined. this non-parametric statistical test is used to determine whether or not there is a statistically significant difference between all experimental groups. only the qualitative response regression model or probability model is used in this investigation since sri choice is a categorical variable. in the experiment, choosing an sri fund as an investment choice is rated as 1, while choosing any other investment option is rated as 0. as the sri decision (dependent variable) is a binary variable, the linear probability model (lpm) and the logit model are used to estimate the model. this study moves on to conduct moderation analysis to see how financial literacy affects the relationship between sri (a dependent variable) and default nudges (an independent variable). moderator is introduced as an interaction term in both lpm and logit models. to measure financial literacy, we use the big 3 scale of lusardi and mitchell (2011). in this scale, three questions about inflation, interest, and risk are asked, and a financial literacy score is calculated. demographics, risk tolerance level and social behavior of investors are used as control variable in this study. age, gender, education, marital status, employment, income and investment experience are taken as demographics in this study. for investment experience, score is calculated by asking them about their investment history. to measure risk tolerance, a modified scale from kapteyn and teppa (2011) is used, which was also employed in the study by apostolakis et al. (2016). social behavior is the type of behaviour that leads to people being drawn to charitable causes. to measure this behavior, we ask several questions to be answered on a 5-point likert scale (polonsky et al., 2002). south asian review of business and administrative studies vol. 5, no. 1, june 2023 6 results: table 1 shows the descriptive statistics on the composition of both treatment groups and the control group alongside the three dimensions of covariates i.e. demographics, risk tolerance level, and social behavior, and a moderator i.e. financial literacy. demographics include age, gender, education, marital status, employment, income, and investment experience. table 1: descriptive statistics the participants are randomly allocated to all three experimental groups. so, it is anticipated that due to randomization, the difference among the all three groups is insignificant. when randomization worked effectively, it means there is no need of control variables. the kruskalwallis rank test is used to test whether randomization is effective. the p-values of kruskal-wallis test shows that randomization worked, excepting the odd of education and financial literacy, the differences among all groups are insignificant. next, we test whether any of the treatment or nudging groups differ substantially from the control group in terms of the likelihood of selecting an sri fund. table 2 reports the empirical findings of both lpm and logit models. here, the dummies are assigned to each experimental treatment group, with the control group omitted. omitted categories are used as reference categories in this model. variables attributes opt-in opt-out control kruskal-wallis test p-values n [%] n [%] n [%] demographics age 18-24 77 [44.3] 60 [36.8] 65 [36.3] 0.534 25-34 56 [31.8] 58 [35.6] 70 [39.1] 35-49 36 [20.5] 41 [25.2] 40 [22.4] ≥ 50 7 [4.0] 4 [2.5] 4 [2.2] gender male 112 [63.6] 110 [67.5] 119 [66.5] 0.815 female 64 [36.4] 53 [32.5] 60 [33.5] education ph.d. or equivalent 15 [8.5] 15 [9.2] 22 [12.3] 0.008*** master's degree 41 [23.3] 45 [27.6] 59 [33] bachelor's degree 57 [32.4] 49 [30.1] 59 [33] intermediate 61 [34.7] 51 [31.3] 39 [21.8] high school or less 2 [1.1] 3 [1.8] 0 [0] martial status married 76 [43.2] 78 [47.9] 95 [53.1] 0.257 unmarried 100 [56.8] 85 [52.1] 84 [46.9] employment full time 62 [35.2] 59 [36.2] 66 [36.9] 0.715 part time 38 [21.6] 41 [25.2] 36 [20.1] retired 0 [0] 2 [1.2] 5 [2.8] self employed 31 [17.6] 29 [17.8] 32 [17.9] student/unemployed 45 [25.6] 32 [19.6] 40 [22.4] salary <50,000 114 [64.8] 105 [64.4] 115 [64.3] 0.991 50,000-100,000 41 [23.3] 37 [22.7] 44 [24.6] 100,000-250,000 18 [10.2] 16 [9.8] 11 [6.2] >250,000 3 [1.7] 5 [3.1] 9 [5] mean mean mean [std dev] [std dev] [std dev] score (0-4) 1.949 1.908 1.866 0.849 [1.378] [1.374] [1.412] risk tolerance 5-point likert scale 3.475 3.221 3.402 0.191 [0.97] [1.073] [0.923] social behavior 5-point likert scale 3.647 3.733 3.663 0.782 [0.736] [0.526] [0.576] financial literacy score (0-3) 1.443 1.352 1.181 0.0269** [0.873] [0.916] [0.899] investment experience thi s tabl e s hows the des ci pti ve s tati s ti cs of two treatment groups and one control group al ong the di mens i ons of control vari abl es i .e. demographi cs , i nves tment experi ence, ri s k tol erance and s oci al behavi or, and moderator vari abl e i .e. fi nanci al l i teracy. p-val ues are obtai ned through krus kal -wal l i s rank tes t i s us ed to as s es s the di fference among al l thes e groups col l ecti vel y. ***,** and * i ndi cate s i gni fi cance at 1%, 5% and 10% l evel s res pecti vel y. south asian review of business and administrative studies vol. 5, no. 1, june 2023 7 the coefficient on each dummy shows the average treatment effect of that nudge as compare to control group, and the sign of the coefficient shows the direction of the relationship, which is more important in this case. table 2: average treatment effects of both opt-in and opt-out defaults: results of lpm and logit models the first nudge of this study is an opt-in default nudge. the results of the lpm model show that the average treatment effect of an opt-in nudge on sri decisions is highly statistically significant at the 1% significance level. the sign of the coefficient is positive, which shows that an opt-in nudge increases the probability of an sri decision. the coefficient value of the opt-in nudge is interpreted as that when the opt-in choice for default is available to participants, it increases the probability of an sri decision by 0.1744 as compared to the control group. in logit model, the odds of selecting the default option sri fund is 2.26 in the opt-in default nudge group. the odds of taking a sri decision in the opt-in treatment group are 1.26 times (126%) higher than the odds in the control group. the marginal effect (m.e) of an opt-in nudge is interpreted as follows: when an opt-in choice for default is available to participants, it increases the probability of an sri decision by 0.203 as compared to the control group. the effect of an opt-in nudge on sri decisions in logit model is also significant at the 1% significance level. these results align with the study by steffel et al. (2016), which shows that default nudges are still significant when they are less manipulative. the second nudge is an opt-out default nudge. the results of the lpm model show that the average treatment effect of an opt-out nudge on sri decisions is highly statistically significant at the 1% significance level. the sign of the coefficient is positive, which shows that an opt-out nudge increases the probability of an sri decision. the coefficient value of the opt-out nudge is explained as follows: when preselected an opt-out default choice is given to participants, it increases the probability of selecting sri fund by 0.5445 as compared to the control group. in logit model, odds of continuing with the default option sri decision are 11.5 in the opt-out treatment group. the odds of making a sri decision and opting out of the treatment group are 10.5 times higher in the treatment group than in the control group. the marginal effect (m.e) value of the opt-out nudge shows that when a sri default opt-out choice is given participants as a treatment, it increases the probability of an sri decision by 0.608 as compared to the control group. the effect of an opt-out nudge on sri decisions is highly significant at the 1% significance level. these results support the findings of previous studies that preselected default option have great significant impact on the financial decision of an individual (gajewski et al., 2021; camilleri et al., 2019; and madrian & shea, 2001). p-value t-statistics odds ratio m.e p>׀z׀ opt-in 0.1744*** 0.000 3.57 0.8145*** 2.258 0.203 0.000 (0.0489) (0.2337) opt-out 0.5445*** 0.000 11.96 2.4430*** 11.507 0.608 0.000 (0.0455) (0.2584) observations 518 observations 518 r-squared 0.203 lr chi sq. 110.29 f-statistics 73.76 p-value 0.000 f significance 0.000 robus t sta nda rd error (lpm) /sta nda rd error (logi t mode l ) i n pa re nthe s e s . mode l i ncl ude the cons ta nt. so n-1 dummi e s a re a l l otte d a nd omi tte d ca te gory i s re fe re nce ca te gory. al l the nudge coe ffi ci e nts a re re l a ti ve to control group. m.e i s the ma rgi na l e ffe ct of e a ch i nde pe nde nt va ri a bl e i n logi t mode l , whi ch i s ca l cul a te d by formul a m.e= p (1-p)*β. ***,** a nd * i ndi ca te s i gni fi ca nce a t 1%, 5% a nd 10% l e ve l s re s pe cti ve l y. linear probability model (lpm) logit model south asian review of business and administrative studies vol. 5, no. 1, june 2023 8 the results of this study demonstrate that the opt-out nudge is nearly three times more successful than the opt-in nudge when we examine the outcomes of both opt-in and opt-out nudges. these findings align with those of johnson and goldstein (2003), who found that altering the default increased organ donation rates in europe from 15% (opt-in default) to 98% (opt-out default). another study by aysola et al. (2016) discovered that opt-in strategy enrollment rates were 13% while opt-out strategy enrollment rates were 38%. the opt-in nudge is also less manipulative and less likely to limit the decision maker’s autonomy. contrarily, the opt-out default limits an individual's autonomy and is manipulative (smith et al., 2013). as a result, the opt-in nudge is socially and ethically more acceptable than the opt-out default. the empirical results of this study reveal that although though the opt-in nudge effect is less powerful than the opt-out nudge, it still influences sri decisions significantly. so, it can take the place of the opt-out default nudge to increase its legitimacy and face less ethical backlash. the opt-in default nudge, however, works without undermining autonomy. (loewenstein et al., 2014; sunstein, 2016). table 3 illustrates the findings of the interaction terms in both the lpm and the logit models that represent the moderating impact of financial literacy on the relationship between default nudges and sri decisions. in order to interpret coefficients in a way that makes sense, mean centering is used. prior to estimate, the moderator variable for financial literacy is mean-centered by deducting means from the starting values. to get the interaction terms, this mean-centered variable is employed. in order to interpret coefficients in a way that makes sense, mean centering is used. table 3: moderating effect of financial literacy for both opt-in and opt-out defaults: results of lpm and logit models the main effects of opt-in and opt-out nudges are at the reference level of financial literacy zero, which is the mean value of financial literacy as a result of mean centering, and the main effect of financial literacy displays the effect in the control group where there is no nudge. in moderated regression, the interaction effects are more relevant. the positive sign of the opt-in interaction term is explained as the financial literacy of an individual enhancing the effectiveness of the opt-in nudge, but this effect is not significant. the negative sign of the opt-out interaction term is explained as the financial literacy of an individual reducing the effectiveness of the opt-out nudge. the opt-out nudge is significant for this moderating effect at the 10% level of significance. hence, the moderation effect of financial literacy is generally just partially significant. the coefficient p-value t-statistics odds ratio m.e p>׀z׀ opt-in 0.1613*** 0.001 3.270 0.7467*** 2.110 0.186 0.002 (0.0493) (0.2381) opt-out 0.5402*** 0.000 11.740 2.4635*** 11.746 0.613 0.000 (0.046) (0.2657) financial literacy 0.0099 0.781 0.280 0.0544 1.056 0.014 0.782 (0.0356) (0.1963) opt-in×financial literacy 0.0732 0.178 1.350 0.2941 1.342 0.073 0.269 (0.0543) (0.2663) opt-out×financial literacy -0.0865* 0.093 -1.680 -0.4941* 0.610 -0.123 0.084 (0.0514) (0.2862) observations 515 oservations 515 r-squared 0.213 lr chi sq. 116.28 f-statistics 33.15 [p-value] 0.000 f significance 0.000 linear probability model (lpm) logit model thes e are the res ul ts of moderati on effect of fi nanci al li teracy from both lpm and logi t model , whi ch provi de i nteracti ons on addi ti ve and mul tl i pl i cati ve s cal es res pecti vel y. robus t standard error (lpm) /standard error (logi t model ) i n parenthes es . model i ncl ude the cons tant. so n-1 dummi es are al l oted and ommi tted categoey i s reference category. al l the nudge coeffi ci ents are rel ati ve to control group. m.e i s the margi nal effect of each i ndependent vari abl e i n logi t model , whi ch i s cal cul ated by formul a m.e= p(1-p)*β. ***,** and * i ndi cate s i gni fi cance at 1%, 5% and 10% l evel s res pecti vel y. south asian review of business and administrative studies vol. 5, no. 1, june 2023 9 value of the opt-out nudge in the lpm model is -0.0865, which is interpreted as when financial literacy is increased by one unit from its mean value, the success probability of opt-out nudge is reduced by 0.0865 and vice versa. similar to this, the opt-out nudge's marginal effect (m.e) in the logit model is -0.123, which may be translated as: when financial literacy is raised by one unit from its mean value, the opt-out nudge's success probability is decreased by 0.123, and vice versa. dawson (2014) two-way logistic interaction plot is used to further evaluate the substantial moderating effects, as illustrated in figure 1. the dotted line depicts a less significant influence, whereas the solid slope depicts a significant effect. this figure shows that the moderation effect of financial literacy is significant for an opt-out nudge at low levels. the nudge-ability of an opt-out nudge is greater at low financial literacy levels and less at high financial literacy levels. in other words, as financial literacy rises, opt-out default's efficacy decreases, as seen by the slopes in the interaction plot. figure 1: two-way logistic interaction plot for opt-out nudge conclusion this study empirically investigates the impact of default nudges on sri decision of investors in pakistan. this study used the opt-out default and opt-in default nudges to increase the sri investment by overcoming the complexity barrier. a sample size of n = 518, a representative sample of potential private investors from pakistan, who are recruited through a commercial online panel, is used in this study. to collect the data, an incentivized online survey experiment is conducted. in this experiment, nudges are assigned randomly through software to different groups in such a way that only one nudge is given to each of the eight treatment groups and no nudge is assigned to the control group. the covariates of the sri decision are controlled automatically through this randomization. the overall empirical findings of this research conclude that nudges can be used as an effective strategy to enhance socially responsible investment. this study also concluded that the financial literacy partially reduce the effectiveness of nudges. both nudges used in this study significantly increase the share of individuals who choose sri as an investment decision. the results of this study demonstrate that the opt-out nudge is nearly three times more successful than the opt-in nudge when we compare the outcomes of both nudges. the empirical findings of this study show that the opt-in nudge effect still has a considerable impact on sri decisions, albeit being less potent than the opt-out nudge. this might thus be used as a counter-strategy to the opt-out default nudge in order to increase its legitimacy and encounter fewer ethical concerns. in addition to the core relationship between nudges and sri, this study also examines the moderation effect of financial literacy on this relationship. the empirical findings imply that opt-out nudge effectiveness is reduced if the individual is financially literate, and vice versa. financial literacy doesn’t have a significant impact on the effectiveness of an opt-in nudge. the empirical findings of this study can aid state-level sri policymakers in creating better south asian review of business and administrative studies vol. 5, no. 1, june 2023 10 investment instruments that, when used in conjunction with other policy tools, can promote sri investment in society. references abadie, a., & gay, s. 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(2022). green economic growth and its inherent driving factors in chinese cities: based on the metafrontier-global-sbm superefficiency dea model. gondwana research, 106, 315-328. south asian review of business and administrative studies vol. 5, no. 1, june 2023 13 appendix 1: table 4: results of lpm model with financial literacy and education used as control variable table 5: results of logit model with financial literacy and education used as control variable _cons -1.712059 .3362246 -5.09 0.000 -2.371047 -1.053071 education .201846 .1032079 1.96 0.050 -.0004378 .4041298 fl -.0145678 .1134574 -0.13 0.898 -.2369401 .2078046 oo 2.393341 .2601849 9.20 0.000 1.883388 2.903294 oi .7435754 .2376638 3.13 0.002 .2777629 1.209388 sri coef. std. err. z p>|z| [95% conf. interval] log likelihood = -299.90553 pseudo r2 = 0.1570 prob > chi2 = 0.0000 lr chi2(4) = 111.75 logistic regression number of obs = 515 iteration 3: log likelihood = -299.90553 iteration 2: log likelihood = -299.90553 iteration 1: log likelihood = -299.94131 iteration 0: log likelihood = -355.78056 . logit sri oi oo fl education south asian review of business and administrative studies vol. 5, no. 1, june 2023 14 table 6: results of the lpm of financial literacy moderation using education as a control variable table 7: results of the logit model of financial literacy moderation using education as a control variable _cons .1400775 .0615456 2.28 0.023 .0191623 .2609927 education .0370341 .020013 1.85 0.065 -.0022843 .0763525 ooxfl -.0851137 .0514976 -1.65 0.099 -.1862881 .0160608 oixfl .0697126 .0542091 1.29 0.199 -.0367891 .1762143 fl .0032331 .036838 0.09 0.930 -.0691404 .0756066 oo .5320354 .046502 11.44 0.000 .4406755 .6233953 oi .1513333 .0496412 3.05 0.002 .053806 .2488606 sri coef. std. err. t p>|t| [95% conf. interval] robust root mse = .4441 r-squared = 0.2182 prob > f = 0.0000 f( 6, 508) = 29.11 linear regression number of obs = 515 . regress sri oi oo fl oixfl ooxfl education, vce(robust) _cons -1.692878 .3401941 -4.98 0.000 -2.359646 -1.026109 education .1966172 .1049472 1.87 0.061 -.0090755 .4023099 ooxfl -.5023187 .288322 -1.74 0.081 -1.06742 .0627821 oixfl .277189 .2669143 1.04 0.299 -.2459535 .8003314 fl .0207238 .1970523 0.11 0.916 -.3654917 .4069393 oo 2.4423 .2667424 9.16 0.000 1.919495 2.965106 oi .6979464 .2400834 2.91 0.004 .2273915 1.168501 sri coef. std. err. z p>|z| [95% conf. interval] log likelihood = -295.87058 pseudo r2 = 0.1684 prob > chi2 = 0.0000 lr chi2(6) = 119.82 logistic regression number of obs = 515 iteration 4: log likelihood = -295.87058 iteration 3: log likelihood = -295.87058 iteration 2: log likelihood = -295.87075 iteration 1: log likelihood = -296.05145 iteration 0: log likelihood = -355.78056 . logit sri oi oo fl oixfl ooxfl education south asian review of business and administrative studies vol. 5, no. 1, june 2023 15 appendix 2 (questionnaire): nudges questions decision screenshots: 1. hypothetical investment scenario (control group) 2. opt-in default nudge (type 1 transparent nudge) (after presenting hypothetical investment task, the following option is given. if the participant click this option, all choices with pre-selected sri fund option is shown to them. if the participant do not click this option, all choices with no pre-selected option is shown to them) 3. opt-out default nudge (type 1 non transparent nudge) (after presenting the hypothetical scenario with pre-selected sri fund option, the following instructions are given) south asian review of business and administrative studies vol. 5, no. 1, june 2023 16 financial literacy questions the following questions are about finance. q-1: do you think the following statement is true or false? “buying a single company stock usually provides a safer return than a stock mutual fund.” true false refuse to answer do not know q-2: imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. after 1 year, with the money in this account, would you be able to buy more than today exactly the same as today less than today do not know refuse to answer q-3: suppose you had amount 100 in a savings account and the interest rate was 2% per year. after 5 years, how much do you think you would have in the account if you left the money to grow? more than 102 exactly 102 less than 102 do not know refuse to answer suppose you had amount 100 in a savings account and the interest rate was 2% per year. after 5 years, how much do you think you would have in the account if you left the money to grow? more than today exactly the same as today less than today do not know refuse to answer south asian review of business and administrative studies vol. 4, no. 1, jun 2022 59 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas investment performance in local government units: an analysis of local economic enterprises in the 1st district of rizal renz paolo b. ramos, department of political science, faculty of arts and letters, university of santo tomas, manila, philippines article details abstract history revised format: may 2022 available online: june 2022 keywords local investment performance, local economic enterprise, fiscal decentralization, socio-economic development. local economic enterprises are government entities created through fiscal autonomy to generate revenues and become self-reliant. this paper attempts to establish linkages between local public investments performance through local economic enterprises (lees) in achieving immediate outcomes indicating socio-economic development. likewise, the study tested if there is significant associations between the presence of lees and three (3) indicators of socio-economic development; job creation, revenue generation and business proliferation. using mixed-methods and archival data, the study was able to arrive at significant findings. based on the results of the study, job creation, revenue generation and business proliferation are the immediate outcomes of lees. the second major finding was that there is significant association between the lees and the three (3) indicators. however, it was found that there was a low correlation between lees effectiveness and sustainability as local investments for socio-economic development. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: rbramos@ust.edu.ph doi: https://doi.org/10.52461/sabas.v4i1.1032 introduction this paper attempts to establish linkages between local government investments through local economic enterprises (lees) and socio-economic development at the local level under the decentralized structure of the philippines. in 1991, the local government code (lgc) was enacted by the philippine congress to decentralize the government into its sub-states as mandated by the article 10 section 3 of the 1987 constitution. the code paved the way for the creation of territorial and political subdivisions of the state which benefits local autonomy. the local government code empowered local government units not only political powers but also corporate powers. this reflects the dual nature of local government units in the philippines, one as a political subdivision of the state and the other being a public corporation as stated in the sec. 15 of the code (pimentel a. j., 2011). the local government code has also made it a policy that local government units (lgu) have the power to create their own sources of revenue to enable them to become self-reliant communities. therefore, aside from mandated just share of the local government from national https://journals.iub.edu.pk/index.php/sabas mailto:rbramos@ust.edu.ph https://doi.org/10.52461/sabas.v4i1 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 60 taxes, it is also their duty to create other sources of revenue under the law. because of this provision, a thorough local fiscal administration is necessary to secure those resources and revenues earned by different lgu’s as a corporate entity will face lesser tendencies for bankruptcy and debts. according to reyes (2010, p. 2), local fiscal administration refers to the rational, effective and efficient conduct of the fiscal functions and operations of the local government units which embrace the systems, structures, processes, and human resources involved in revenue generation, revenue allocation and utilization. since then, different lgu’s throughout the philippines have ventured into different local economic enterprises (lee) that provides public goods and services while at the same time earning revenue for the local government. different lees established throughout the philippines varies from conventional public enterprises specified in the lgc and other innovative public enterprises which are created by the sanggunian (local legislative council) for various reasons but mainly economic. while there is a growing number of lees in the country, there is no certainty for their continuous existence. earlier study says that although lees are established to be self-sustaining and revenue generating, several of them lack continuity because of several factors that such as wrong appreciation, lacks transparency and accountability (manasan & castel, improving the financial management of local economic enterprises, 2010). likewise, samonte (1967) has observed that the role public enterprises in the philippines is widely varied through the years because of the changing political atmosphere and socio-economic conditions. for this reason, the focus of this research is on the assessment of investments performance of lgus through selected local economic enterprises in providing help not only to income stability of local governments as well as the socio-economic status of the locality. the study will review the contribution of the lees to socio economic development in the municipalities involved in this study. one of the emerging trends in local governance in the philippines is the establishment of local economic enterprises wherein delivery of public services are made in an entrepreneurial manner. according to manasan there was an enormous increase in the number of lees in the country since the time the lgc of 1991 took effect. local governments made use of their fiscal autonomy to create these public enterprises (manasan & castel, improving the financial management of local economic enterprises, 2010). in addition, when lgus invest on economic enterprises they are guided by market ideologies; therefore, the more the lgus operate like real corporations or enterprises, they become more efficient and viable (del castillo & gayao, 2010). as a result, these lees will gain more revenue for the lgu, thus increasing their capacity to deliver public services better and in the long term, improving the socio-economic welfare of their constituents. however, there have been very limited empirical studies done on the effectiveness of lees in contributing to economic development in the context of the philippines. it is therefore worth revisiting what we know about lees to understand how and under what circumstances they can be beneficial to socio-economic development. a study by holmes (2011) found that decentralization was seen as an essential ingredient to democratization as fiscal autonomy liberated local governments from whimsical distribution of funds from the national government while allowing them to create their own sources of revenue (holmes, 2011). along with this growth of interest in fiscal decentralization, there is an increasing concern over its significant contribution to local social and economic development. this paper examined the case of fiscal decentralization in the philippines. local governments in the philippines follows a mandate that articulates their fiscal autonomy in creating sources of revenue. in this paper the researcher argues that local economic enterprises as a product of fiscal autonomy, can be an effective way to stimulate socio-economic development in provinces, cities and municipalities other than metro manila. thus, this study considered four (4) municipalities, south asian review of business and administrative studies vol. 4, no. 1, jun 2022 61 all of which are 1st class municipalities according to philippine statistics authority in the province of rizal as focus points to give assertion to this claim. hence, the researcher observed that these municipalities generate huge amount of revenues and in effect these lgus can further promote development in their localities given the abundant fiscal capacity they possess. the paper attempts to show that municipalities with enough capacity to create their own sources of revenue can invest in both public serving and income generating facilities such as local economic enterprises to accelerate socio-economic development in their locality. this thesis intends to determine the extent of the contribution made by local economic enterprises to the development of social and economic state of their communities. while the study only attempts to substantiate only three (3) aspects of development, the researcher agrees with the perspective that japanese scholars had on their study on socio-economic development which stated that: development is an overall process of social change bracketing together a number of more basic sub processes of change, and that these constituent process tend to proceed reinforcing each other in the same direction, but they proceed at different paces in different stages of development (takamori & yamashita, 1973, p. 113). research objectives the main objective of the study was to know how beneficial lees are to socio-economic development in terms of local investment performance in the 1st district of rizal province, the specific objectives of the study are: 1. to determine how lees as local investments achieve immediate outcomes (job creation, revenue generation, and business proliferation) indicating socio-economic development 2. to determine whether job creation, revenue generation, and business proliferation have significant associations with the presence of lees literature review decentralization happens when state power is transferred to local governments to increase the efficiency and effectiveness of local government units in responding to the needs and welfare of their constituents (porio, 2012). in addition, a filipino scholar defined decentralization in reference to his observation that it has become one of the major trends in the world today which organizes the “opening up and loosening of formal institutions and processes of centralized governments within the context of redemocratization” (brillantes, 2003, p. 1) this study finds support on two (2) main theories under the new public management phenomenon namely, fiscal decentralization by wallace oates (2006) and public entrepreneurism by david osborne (2007). furthermore, theories in political economy and economics which in this study served as sub-theories. these theories are the strength of this study which will serve as main reference in the analyzing parallel phenomena observed in this study. fiscal decentralization theory falls under the new public management phenomenon in public administration which features several theories on how the bureaucracy can be more effective through economic and enterprise management mechanisms. in the united kingdom where npm was predominant among pa scholars, it was emphasized that: the superiority of private-sector managerial techniques over those of pa with the assumption that the application of such techniques would automatically lead to improvements in efficiency and effectiveness of these services (thatcher, 1995 as cited in osborne s. , 2006 p.379) south asian review of business and administrative studies vol. 4, no. 1, jun 2022 62 fundamentally, npm is an innovation of the traditional theory on public administration; the primary objective is the improvement allocation of public goods and services in the public sector through private-sector management techniques. one of the essential concepts of this study is decentralization because the main focus of this study are local government units with emphasis on their fiscal affairs. according to wallace oates (2006), fiscal decentralization as a theory is explained as: for a public good-the consumption of which is defined over geographical subjects of the total population, and for which the costs of providing each level of output of the good in each jurisdiction are the same for the central or for the respective local government-it will always be more efficient (or at least as efficient) for local governments to provide the pareto-efficient levels of output for their respective jurisdictions than for the central government to provide any specified and uniform level of output across all jurisdictions (oates, 2006, pp. 34). as oates mentioned, the central government tends to provide generic and standardized public service to the people despite geographical divisions. therefore, it can be understood that pareto efficiency can be achieved if resources from the central government are instead given to local governments because resources can be optimized because public goods and services will be more fitted to the needs of the people. university of the philippines professor capuno explained that the theory of fiscal federalism (other scholars refer to fiscal decentralization as such) suggested that efficient delivery of public goods under a decentralized structure leads to development however it demands local government officials’ commitment to their constituent’s welfare (capuno, 2005, p. 3). another theory that supports the study is public entrepreneurism theory by david osborne initially published in 1993. this theory explains that the traditional bureaucratic organizational structure delivers standardized services which are ineffective. in order for governments to be effective in delivering public goods and services, “an organization must lean, fast on its feet, responsive to its customers, capable of adjusting to constant change, able to improve productivity continually. in other words, it needs to be entrepreneurial rather than bureaucratic” (osborne, 1993, p. 351). still, osborne disputes that entrepreneurial does not necessarily mean “for profit” but according to him: an entrepreneur shifts resources out of an area of low productivity and minimal yield into an area of higher productivity and greater yield (p. 351) osborne formulated the theory in response to fiscal problems faced in the united states during the recession wherein according to him, spending went out of control. public entrepreneurism is tasked to make governments productive again, doing more with less without reducing the size of the bureaucracy. osborne observed that governments in times of fiscal problems tend to cancel services that are politically vulnerable. moreover, theories discussing budget and investments in public sector also find relevance to the study. economics play an important role in explaining the phenomenon at hand especially on the budget and government spending perspective. john maynard keynes, a renowned economic theorist conceptualized the so-called “keynesian economics”. this theory discussed the relationship of total spending in the economy and its effect on output and inflation (blinder, 2011). this study investigates on local investments specifically local economic enterprises, in the keynesian perspective, consumption, investments, and government expenditures are components of spending which affect government outputs. if government spending increases, for example, and all other components of spending remain constant, then output will increase. keynesian models of economic activity also iclude a so-called multiplier effect; that is output increases by a multiple of the original change in spending that caused it (blinder, 2011 p.1). south asian review of business and administrative studies vol. 4, no. 1, jun 2022 63 the keynesian perspective of the economic aspect of local investments suggests that if government spends on infrastructures or entities such as economic enterprises, output will increase provided that the components of spending remain constant. local economic enterprises have different objectives why they were created by the local government units. primarily they have been created to increase revenue and achieve sustainable benefits for the community. local government units invest on lees to gain more resources that could increase their services to the people. in economics, lees as local public investment may be generally considered necessary for the provision of certain vital goods and services that are either impossible for the private sector to efficiently supply or are such that only one supplier could invest in them economically. in politics, local public investments are necessary to achieve a variety of political objectives such as local security and protection of property rights, maintenance of the rule of law, local economic development and full employment, a greener environment, and greater equality in the distribution of local income and wealth. the aim of the paper is to provide a conceptual theoretical framework based on local economic enterprises as they operate as local government investments in achieving sustainable public investments for lees to accelerate development. investment decisions come from local government officials wherein the decision on what to invest on lies on the decision of mainly the local chief executive. this can be part of his flat form of development or just one of his political agendas. politics aside, lees are established to provide for a certain need like infrastructures, goods, or services that are deemed to local demand of development. likewise, lees are created because of local industrialization to facilitate growth of urbanizing communities. to realize this goal, municipalities and cities follow the local development plan. each municipality or city has a different plan that conforms to their capacity as an lgu and the need of their constituents. local investments are part of the overall local development plan of each lgu. local investments are needed to provide additional local income in compliance with the fiscal decentralization system provided by the lgc of 1991. markets and commercial spaces where people rent their spaces and sell their goods, lgus earn from the lease agreements of the stalls and the business that operates from these stalls. therefore, these contributes to local income and then it will be spent for other goods and services by the lgus all of which contributed to local socio-economic development thus achieving the planned investments. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 64 in the operation and management of lees, there are numerous ways to ensure that the local investment perform to achieve intermediate outcomes. strict enforcement of the ordinance that created and legalized the operation of lees, strengthened accountability among local officials, a transparent system of finances, a special account for lees as mandated in sec. 313 of the lgc of 1991, and capacity building of work force are keys toward achieving sustainable local development investments in lees. similarly, development strategies within the institution is necessary to accelerate results of local investments in lees. once all these strategies and mechanisms were part of the local development plan and were applied by local government officials, socio-economic development is within reach through sustainable local investments in local economic enterprises. the lgc has also provided guidelines in local fiscal administration. the lgc mandates lgus to maintain special accounts for their economic enterprises as cited in section 313. this provision orders how the profits from lees should be allocated. profits or income derived from the operation of public utilities and other economic enterprises, after deduction for the cost of improvement, repair and other related expenses of the public utility or economic enterprise concerned, shall first be applied for the return of advances or loans made thereof. any excess shall form part of the general fund of the local government unit concerned. (local government code, 1991) the section ensures that the profits of lees should sustain first its operation before it becomes profitable to the lgus. similarly, in the united states, this regulation is also practiced in the form of tax increment financing (tif). the tif method is a widely used tool among local governments in the united states, according to this theory: …the revenue growth generated territorially defined district is earmarked, for a period of years, for physical infrastructure and other expenditures designed economic growth within that district. by generating new growth, improvements and expenditures produce the incremental that are used to pay for the program which sparked the growth. typically presented as self -financing, with its expenditures the increased revenues resulting from tif-financed growth, tax increase (briffault, 2010, p. 66) this section of the lgc also provided security for lees not to be taken advantage of by come and go politicians. in addition, it can be said that the law has provided enough safeguards for lees not to fall into bankruptcy especially on the initial years of its operation by allotting a share of the profits to fund maintenance repairs and other liabilities. likewise, this will be key for earning lees to expand their facilities and services that will cater to more constituents and eventually become a self-financing government entity. methodology in order to meet the objective of this study, the researcher employed a case study design on the experience of the local economic enterprises in improving the socio-economic status of their locality. it analyzed the changes in revenue generation, job creation and employment, and the increase of businesses (smes) after the existence of the involved lees. survey method was used in gathering the quantitative data while for the qualitative data, key informants interview method was employed. both findings from quantitative and qualitative data were combined and then analyzed in order to arrive at conclusions that could validate or invalidate the research questions based on substantial empirical evidence. the study also utilized existing secondary data coming from both national and local governments to support the veracity of the findings from the qualitative and quantitative data. findings from south asian review of business and administrative studies vol. 4, no. 1, jun 2022 65 these data formed the study’s initial results on the socio-economic condition of the locality. furthermore, for numerical data gathered, this research used descriptive statistics in analyzing collected data set from a sample group. this will include the mean, median, mode, variance and standard deviation which are typical statistics necessary to form the foundation for deeper analysis. in search for significant relationships, the study used inferential statistics which is a higher level of statistical analysis which will be key in testing the hypothesis or set of probability levels. the following personalities were selected for the key informants interview: a) municipal tourism officer b) municipal budget officer / municipal treasurer c) public employment and service office manager d) local economic enterprise manager e) municipal councilor who chairs the local legislative committee on ways and means / committee on appropriations the researcher was able to survey two hundred (200) participants selected using purposive sampling technique. the sampling technique was used to allow the selection of appropriate participants for inclusion in the sample. the researcher was able to have fifty (50) participants per municipality having a fair and equal representation for the data. they are in the best position to respond to the investigative research, and they compose as credible and authoritative resources for this study. the study was conducted in the four (4) municipalities that compose the first legislative district of rizal province. these municipalities were chosen because they have been considered by the national competitiveness council (ncc) to be four of the most competitive municipalities in the country. thus, it can be assumed that these municipalities have been actively promoting economic development through different programs and projects. in this research, the selected local economic enterprises will be the non-traditional lees. non-traditional lees as categorized by the lgc of 1991 are other economic enterprises than basic utilities, public market, and slaughterhouses etc. the study is backed by public entrepreneurism theory wherein entrepreneurial character of governments are considered as key to boosting the economy and sustaining development. therefore, the researcher looked at the innovative lees that are possible to be assessed from the perspective of public entrepreneurism. the researcher chose two (2) economic enterprises that are of the same nature, sports and recreation infrastructures and public goods and retail establishments. the assumption was these lees are compliant to the financial, organizational and management purposes for which individual lees are established. the following local economic enterprises were selected among the municipalities considered in this study. first is binangonan recreation and conference center (brcc) located in barangay batingan, binangonan, rizal. this multi-purpose sports and recreation facility was inaugurated in 2013 which features a gymnasium, bowling center, hotel, water park, basketball, volleyball courts. next is angono people’s market, an innovative public market by the municipality of angono wherein the municipality earns a substantial revenue from stall rents and commercial lease. third is the widely popular taytay municipal tiangge, which is a local government initiative to restimulate the local garments industry. to date, the taytay municipal tiangge has grown to other private counterparts and has earned huge amounts of revenues for the municipality that boasts itself now as the “garments capital of the philippines. last on the list of the lees is cainta one arena. although less size and amenities compared to brcc, cainta one arena has been a multipurpose events place for the people of cainta. known to be a flood-prone area, aside from being utilized in sports and public events, the arena also serves as an emergency relocation for residents displaced by floods and other natural calamities. these lees are all within the first legislative south asian review of business and administrative studies vol. 4, no. 1, jun 2022 66 district of the province of rizal, who is represented by a common congressman at the philippine house of representatives. known to be first class municipalities, it is also worth noting that compared to other lower-class municipalities in the country, these municipalities have the privilege to invest their financial resources to other types of revenue generating infrastructures where they can earn aside from the constitutionally granted internal revenue allotment (ira). results and discussion the following data presented are related to socio-economic factors as primary results of local investments efforts of lgus through lees are presented on table 2. table 1 three (3) year averages of results and annual growth rates of local economic enterprises 2014-2016 (source: collected documents from lgus) overall, the highlighted texts on the table represents the (three) 3 year average measure of performance according to the documents secured from the participating lgus. whereas, the rows below each three (3) year performance measure average for each municipality represents the growth or decline rates for each year. generally, the data showed that each lee performed differently in all aspects. there was no lee that consistently performed positively which may be associated with the difference in nature of each lee. on the job creation column, there are noticeably more decline than growth in job creation. this decline is associated with the cost-cutting in operation of brcc and the privatization of the half of the taytay municipal tiangge in 2015, therefore affecting the number of jobs that these lees used to provide. the same story is observed for the employment aspect. since lesser jobs were made available then correspondingly the number of people employed also decreased. for the proliferation of businesses here referring to micro, small, and medium enterprises, positive developments are observed as each lee contributed to increase the number of businesses registered in their municipalities. similarly, it was observed that all lees earned revenues for their municipalities with angono public market and taytay municipal tiangge earning more than an average of three million pesos (php 3,000,000+) in three years. hence, the growth in number of businesses (msmes) and annual revenues are positive immediate results of local investments through lees. looking at the socio-economic developments of the selected municipalities, table 4.2 revealed the perceptions of the respondents on socio-economic factors attributed to the lees. according to south asian review of business and administrative studies vol. 4, no. 1, jun 2022 67 the data, the respondents were aware of their respective lees (all medians=8.0). on the overall, the lees were frequently accessible (median=3.0). table 3 socio-economic perceptions of respondents among local economic enterprises (source: author’s survey results) factors lees overall (n=200) angono public market (n=50) brcc (n=50) cainta one arena (n=50) taytay tiangge (n=50) awareness 8.0 (1.0) 8.0 (3.0) 8.0 (2.0) 8.0 (2.0) 8.0 (3.0) accessibility 3.0 (3.0) 2.0 (3.0) 2.0 (3.0) 3.0 (3.0) 3.0 (3.0) availability 3.0 (1.0) 3.0 (1.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) job creation 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 4.0 (1.0) 3.0 (2.0) income generation 3.0 (2.0) 3.0 (2.0) 3.0 (3.0) 3.0 (2.0) 3.0 (3.0) business proliferation 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) effectiveness 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) sustainability 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) 3.0 (2.0) sufficiency 3.0 (1.0) 3.0 (2.0) 3.0 (2.0) 3.0 (3.0) 3.0 (3.0) level of satisfaction 7.0 (3.0) 6.0 (4.0) 6.0 (4.0) 6.0 (4.0) 6.0 (4.0) notes: values are median (range). the following are the interpretations for the median values: awareness: 1.0-2.0 no idea, 2.1-4.0 unaware, 4.1-6.0 moderately aware, 6.1-8.0 aware accessibility: 1.0-1.8 rarely, 1.9-2.6 sometimes, 2.7-3.4 frequent, 3.5-4.0 very frequent level of satisfaction: 1.0-2.0 strongly disagree, 2.1-4.0 disagree, 4.1-6.0 agree, 6.1-8.0 strongly agree all other factors: 1.0-1.8 strongly disagree, 1.9-2.6 disagree, 2.7-3.4 agree, 3.5-4.0 strongly agree however, brcc and cainta one arena were sometimes accessible (median=2.0). likewise, the constituents agreed that the lees were available for use, created jobs for them, generated revenues to their municipalities, helped in the proliferation of businesses, effective, sustainable, and sufficient (all medians=3.0). also, according to the respondents in taytay, they strongly agreed that the municipal tiangge created jobs to its people (median=4.0). meanwhile, the overall level of satisfaction showed that they agreed to the socio-economic developments contributed by the lees to their respective municipalities (median=6.0). illustrated below are the distribution tables for each indicator of socio-economic development measured in this study. this study also aimed to determine whether there were significant associations between lees and the socio-economic developments in the area. table 4.3 below showed the results of the analysis. based on the data, awareness (p-value=0.006), accessibility (p-value<0.001), job creation (pvalue<0.001), income generation (p-value<0.001), business proliferation (pvalue<0.001), sufficiency (p-value=0.003), and the overall level of satisfaction (p-value<0.001) have statistically significant associations with the presence of these lees. however, availability (p-value=0.086), south asian review of business and administrative studies vol. 4, no. 1, jun 2022 68 effectiveness (p-value=0.341), and sustainability (p-value=0.3121) were not significantly related to the lees. table 4. association analysis between socio-economic factors and local economic enterprises. factors p-value awareness 0.006* accessibility <0.001* availability 0.086 job creation <0.001* income generation <0.001* business proliferation <0.001* effectiveness 0.341 sustainability 0.3121 sufficiency 0.003* level of satisfaction <0.001* note: *significant at 0.05 level of significance. conclusion at the beginning of this paper, the researcher established the need for an academic investigation on how local government units at present use fiscal decentralization power in becoming self-reliant communities under the local government code of 1991. the code enabled all local government units in the philippines to create their own sources of revenue in pursuit of sustained development. the researcher found that one of the emerging trends in the practice of fiscal decentralization among local government units in the philippines is the creation of local economic enterprises. according to manasan and castel (2010) one of the pioneering researchers of local economic enterprises in the philippines, the number of lees in the philippines has been significantly increasing throughout the years. however, contrary to how the legislators of the local government code envisioned the role of lees, lees became ineffective entities to help realize development because of wrong appreciation, lack of transparency and accountability and changing roles due to changing socio-political environment. the researcher believed that the assumption of lgc legislation proponents demanded further verification particularly because at present, local governments become more entrepreneurial and innovative in creating local economic enterprises. in this paper the researcher attested that local economic enterprises as an entity created out of fiscal autonomy, can be an effective way to achieve immediate outcomes in socio-economic development of provinces, cities and municipalities other than metro manila. the researcher chose four (4) 1st class municipalities clustered as a legislative district in the province of rizal. these are municipalities of cainta, taytay, angono and binangonan. these municipalities over the last 5 years moved up to the rankings and by 2016 they were already part of the top 10 most competitive municipalities (1st class) according to the national competitiveness council. this observation motivated the researcher to consider this phenomenon as the basis of how fiscal decentralization through lees can be significant in the development of municipalities outside metro manila. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 69 the main objective of the study was to determine how effective is fiscal decentralization manifested through local investments in terms of the creation and operation of local economic enterprises in achieving immediate outcomes indicating socio-economic development. based on the findings, combining the results of the documentary and statistical analyses, the respondents’ assessment of lees performance based on the three (3) indicators of socio-economic development which are job creation, income generation and business proliferation, the researcher can conclude that lees contribute to the acceleration of socio-economic development. similarly, this research confirmed that there are statistically significant relationships between lees and these three (3) factors. however, this research found out that there is a low correlation or definite but small relationship between the presences of lees sustainability of its benefits as well as the effectiveness of the lees as a government entity in delivering public goods or services to the people. this can be attributed to the entrepreneurial nature of lees which are also businesses that are also vulnerable to risks and other market behavior that can be a threat to its existence. in the earlier part of this research, it was explained that while lees are owned and managed by the local government units (lgus) they are investments that are targeted to achieve certain objectives towards sustainability and socio-economic development. hence, the income coming from these lees are used for its operation first before the surplus goes to the general fund. if lees continued to fail and will not earn, local governments can let go of these lees since they are not benefiting from such anymore. given the limitations of this research, the researcher believes that this study has investigated on three (3) critical factors indicating immediate outcomes of socio-economic development that are very relevant to the people living in the municipalities. likewise, the conclusions of this research will contribute to the better appreciation and application of the local government code among local government units and their leaders. recommendations there are several gaps from the researcher’s knowledge about decentralization and local governments, performance assessment and the dynamics of socio-economic development which are not covered by this study. for future researchers, the researcher recommends ways to improve and further verify the hypotheses used in this study. also, this study offers a number of practical recommendations for policymakers, national and local government officials that will help improve the operation and management of local economic enterprises. theoretical recommendations the study covered a whole legislative district composed of four (4) municipalities, all of which are 1st class municipalities which means they have enough financial resources. also, the study only covered one (1) lee per municipality, these are categorized into two kinds of lees; 1) sports and recreation facility and 2) public or flea market. the researcher suggests to cover other classes of municipalities or cities for example lower class municipalities, component cities (cc), independent component cities (icc) highly urbanized cities (huc) and investigate how fiscal decentralization through lees are utilized depending on the financial standing of these municipalities. similarly, in comparing lgus, the type of lees can be homogenous so that research findings can be more specific to a type of lee. this research also only covered three (3) fiscal years in consideration of a single term of a local chief executive. future research could cover as long as nine (9) years or a full term of a local chief executive and conduct an in-depth analysis of how a local chief executive’s leadership affect the operation and management of lees in achieving its objectives. other options of looking into other factors affecting the performance of lees such as financial accountability, human resources, marketing strategies and the like. these other underlying factors which are not thoroughly discussed in this paper will bring about new perspectives in local government administration. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 70 to robustly capture the outcomes and effects of lees, there are more methodological work that are needed aside from the methods used in this research. future researchers can do focus group discussions in gathering primary data especially in capturing in full detail the experiences of direct beneficiaries of lees. also, there is more room for socio-economic analysis and exploration of impact to local governments when lees objectives are not met. the study only used three (3) indicators of socio-economic development, and these are insufficient to totally understand socioeconomic development. and so, to further probe into this interdisciplinary concept, other factors such as education, health, and culture which are fundamental issues that relate to socio-economic conditions. although methodically challenging, this research recommends having a full costbenefit analysis of local governments’ spending on local economic enterprises. this would be beneficial in studying if lees are already becoming a liability instead of an asset for the local government. it is also recommended to use as main references the local development plan and local investment plans of each local government unit as they will be significant in forming the context of research of the same nature. these documents will provide more substance to a more technical analysis in local fiscal administration since this will allow researchers to have a perspective on how local governments allocate their resources to local investments such as local economic enterprises and how much do local government units spend in the improvement of the facilities, goods, and services these entities offer. future researchers can also include the use of internal revenue allotment of different lgus and how this affects or influences the operation and management of lees. this will be key in knowing how revenues are mobilized within a local government unit under the present local government code. it is also worth considering having an analysis on the trend for annual public investment allocated to certain number of percentages to lees in a given period divided between physical or tangible investment in infrastructures, capacity building or intangible investments, and consumption of goods and services like welfare benefits and pensions. practical recommendations the study investigated on the role of local economic enterprises as local government investment in the achieving immediate outcomes indicating socio-economic development in municipalities. all three (3) indicators of socio-economic development were found positively related to local economic enterprises. combining the best practices of each municipality and the results and conclusions of this study, here are some of the recommendations to consider for all government agencies concerned: 1) creation of municipal economic enterprise office the local government code of 1991 empowered local government units to create offices whenever it is necessary especially in aid of a more efficient public service delivery. sec. 76 of the local government code states: every local government unit shall design and implement its own organizational structure and staffing pattern taking into consideration its service requirements and financial capability, subject to the minimum standards and guidelines prescribed by the civil service commission; (local government code, 1991) there are four (4) municipalities investigated in this study, all of which are categorized as 1st class municipalities. among the four (4) municipalities investigated, only two (2) of the four (4) municipalities have an office specifically created to supervise the creation, development, and management of their economic enterprises. the municipality of taytay has created the municipal economic enterprise development and management office (meedmo) which supervises the creation, operation, development, and management of existing and future economic enterprises of the municipality of taytay. in an interview conducted by the researcher with an administrative south asian review of business and administrative studies vol. 4, no. 1, jun 2022 71 officer at the meedmo of taytay, prior to the creation of their office, lees were managed by different offices such as the business permit and licensing office (bplo) or through appointed lee managers directly reporting to the office of the mayor. it was also added by the resource person that at present, the municipal government of taytay through the meedmo has experienced better coordination, monitoring, and evaluation of lees because of the office. the other municipality that maintains an office for lees is the municipality of cainta. the enactment of municipal ordinance 2011-008 by the municipality of cainta paved the way for an inclusive management of lees in their municipality. under the ordinance, all public markets, public cemeteries, sports, recreation, and cultural facilities will be under the municipal economic enterprise office. the experiences of the municipalities of taytay and cainta are pieces of evidence supporting the recommendation of this study for the creation of a separate department tasked to create, develop, operate and manage economic enterprises in local government units. as for the other two municipalities investigated in this study, there are future plans to create an economic enterprise office as well. at present, economic enterprises of operated and managed by the municipalities of binangonan and angono rizal are managed through appointed lee managers directly reporting to the office of the mayor. the angono public market for example is managed by a market master who’s in-charge of the overall operation and management of the public market. for the case of binangonan recreation and conference center (brcc), it is managed by an administrator who also manages the other business within the brcc complex. while this setting could still be effective, the researcher believes that the set-up lacks efficiency especially in the fiscal management aspect. citing the input of the municipal councilor interviewed as one of the key informants of this study, there should be an office that manages all lees and the special accounts created for them. most of the key informants also expressed the need for a more transparency and accountability in managing lees. the local government code under sec. 313 indicates the maintenance of a special account for economic enterprises separate from the general fund. if a municipality owns and operates several economic enterprises, then it is required to maintain a separate account for each of these economic enterprises. therefore, it is more efficient for one office to manage and record the financial resources of economic enterprises as the same provision of the code mandates that revenues from lees shall be used to sustain its operation and only surplus revenues should accrue to the general fund. likewise, this ensures the public that the revenues earned by the lees are used for the improvement of public service delivery. 2) use of dbm manual on setting up and operation of local economic enterprises in 2016, the department of budget and management developed a manual that will guide local government officials in creating and operating their municipality’s economic enterprises. the said manual contains recommendations as to how can municipalities maximize their funds in investing for the creation of an lee. it is a product of an in-depth and continuous work of technical working groups commissioned by the department of budget and management with support coming from the european union. in an interview conducted by the researcher to a municipal budget officer of angono, rizal who is also a key informant in this study, the officer mentioned that the municipality was chose to be one of the pilot municipalities to use the dbm manual. when asked on how it helped the municipality in the operation and management of economic enterprises, the officer said that the manual significantly help in the management of finances of economic enterprises. in view of that, the angono public market instituted computerized collection system and accounting records. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 72 because finances are well-managed, angono public market was able to continuously earn more than it was expected to earn and has been contributing to the general fund of the municipality. the findings of this research support the call of the department of budget and management for all local government units to adopt the manual on setting-up and operating local economic enterprises as prescribed by the department through local budget circular no.111 which was issued in 2016. this will not only be helpful in creating new lees but also help in the assessment or evaluation of existing economic enterprises whether these lees are performing, or underperforming based on their objectives. 3) creation of business one-stop-shops the local government code recognizes the role of the private sector to as partners of lgus in the provision of basic services (local government code, 1991, pp. sec. 3-l). in this study, one of the three main indicators of socio-economic development is business proliferation. in chapter 1.5 the researcher assumed that lees contribute to the increase of local businesses and was affirmed by the findings of this research as discussed in chapter 4.4. thus, it established the fact that local business increase as an effect of local economic enterprises. according to the key informants, one of the problems in terms of local fiscal administration is poor collection. this can be attributed to the bureaucratic of municipal governments which are vulnerable to red tape and other forms of corruption. throughout the course of data gathering for this research, the researcher has observed that only the municipalities of taytay and angono have a permanently functioning facility for business one-stop-shop while municipalities of binangonan and cainta still settles for the business permit and licensing office. business one stop shops are established to reduce bribery in the bureaucracy and to have a more systematic and convenient environment for the people while transacting with the government. business one stop shop is defined by law under republic act 11032 or the “ease of doing business and efficient government service delivery act of 2018” as: sec. 4 (b) business one stop shop ¬– a single common site or location, or a single online website or portal designed for the business permit and licensing system (bpls) of an lgu to receive and process applications, receive payments, and issue approved licenses, clearances, permits or authorizations; (ease of doing business and efficient government service delivery act, 2018, p. 2). the presence of this kind of facility in the municipal government will enhance and accelerate the process of business-related transactions without the inconvenience of bureaucratic practices in the government. it will be an advantage for private entrepreneurs to easily register their businesses and in effect the fees and charges from these business-related transactions will accrue to the general fund of the municipalities. therefore, it will be advantageous for both parties, for the people and the government to have this kind of facility that enhances government efficiency and encourages entrepreneurs to legally operate their businesses. 4) organizing tourism or marketing promotions for lees local economic enterprises are created to provide basic goods and services to the people as well as generate income for local government units. but lees are also business entities that are vulnerable to different market behaviors. thus, lees can also underperform or miss the set objectives for the year. this research then recommends for lee managers to employ different marketing strategies especially for economic enterprises that are categorized as “other economic enterprises” under the local government code which means these are out of the “basic services” category. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 73 four (4) out of the five (5) key informants of this study cited “competition with bigger companies” as one of the problems encountered by lees in relation to socio-economic condition of their municipalities. bigger companies have long established a reputation and better branding and marketing strategies for the people to continuously patronize them. thus, the presence of these big companies poses a threat to local economic enterprises who are limited by the budget appropriated to them by the lgu. in this study, the lees investigated on this study are identified into two (2) categories which are public market and sports and recreation facility. among the four (4) lees, only angono public market did not use any marketing strategy because according to their officials they believe the public market is also a “basic need” for the people. true enough, angono public market was continuously earning over the last years despite the competition from large supermarkets present in their municipality. but for the other three (3) lees investigated on this study, the researcher has observed that these lees use tourism and marketing strategies to proliferate the income of their respective lees. in the case of binangonan recreation and conference center (brcc), the municipal government of binangonan registered as an adventure and ecotourism facility duly accredited by the department of tourism. also, as a sports and recreation facility, the brcc management also offered discounts on the rental and usage fees during the summer season as part of their promotions. same promotion activities were done by cainta one arena during peak season including sports clinics sponsored by the municipal government. the municipal government of taytay also implements various marketing strategies and tourism promotion activities to boost the business environment of taytay municipal tiangge. interviewing the municipal tourism officer of taytay, the officer said that because taytay does not have any natural scenery or bodies of water that they can be used for tourism, they are now promoting taytay tiangge as a tourist site of the municipality. an increase in the popularity of taytay tiangge is the multiplying videos of shoppers sharing their experiences on different social networking sites. the garment’s capital of the philippines has been successful in promoting the lee as it was the biggest earner for the municipality for the last five (5) years. 5) review of the local government code of 1991 one of the pillars of this study is the local government code of 1991. it has been expressed by the researcher in chapter 1.3.2 that the study will be significant in the mandated review of the code which was not done in almost thirty (30) years. the researcher echoes the necessity for the review of the code as mentioned in section 521 to update the fundamental law on local governments and decentralization to the present socio-political and economic condition of the country. for example, the study mainstreamed lees and there are only few provisions on how lees should be created, operated and managed. there should also be a provision penalizing local government officials; elected or civil servants who violate or conspires to violate the provision of maintaining a special account for lees. similarly, furthermore, it will be better to institutionalize the recommendations of the dbm in setting-up and operating lees by incorporating them in the local government code as a separate chapter in the code. this will make necessary feasibility studies, cost-benefit analyses, and other precautionary studies that will anticipate problems were local investments through lees may fail. if only the review of the code was done regularly every five (5) years substantial amendments and reforms could have been done and local governments can maximize on devolved powers and decentralized functions in the interest of developing the social and economic conditions of their localities. since local authorities change especially with changes in political leadership, the law should be kept updated with the changes in political environment, culture, economic conditions, and other socio-political circumstances that may affect local governance. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 74 references briffault, r. (2010). the most popular tool: tax increment financing and the political economy of local government. the university of chicago law review, 77(1), 65-95. retrieved may 14, 2019, from https://www.jstor.org/stable/40663026 brillantes, a. b. (2003). innovations and excellence understanding local governance in the philippines. quezon city: center for local and regional governance, national college of public administration and governance, university of the philippines. capuno, j. j. (2005, july). the quality of local governance and development under decentralization in the philippines. up school of economics discussion paper series no. 0506, 1-39. del castillo, m. r., & gayao, r. g. (2010, january). a municipalities experience on revenue generation and public economic enterprise development. jpair multidisciplinary journal, 30-47. ease of doing business and efficient government service delivery act, republic act 11032 (congress of the philippines may 28, 2018). holmes, r. 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(2012). decentralisation, power and networked governance practices in metro manila. space and polity, 16(1), 7-27. reyes, m. (2010, september 20). local fiscal administration. retrieved april 9, 2018, from scribd: https://www.scribd.com/doc/37770745/local-fiscal-administration samonte, a. g. (1967). the role of public enterprise in philippine national development. university of the philippines, 140-144. doi:35.078.4(914) takamori, h., & yamashita, s. (1973, june). measuring socio-economic development: indicators, development paths and international comparisons. the developing economies, 111-145. doi:https://doi.org/10.1111/j.1746-1049.1973.tb00302.x south asian review of business and administrative studies vol. 4, no. 1, jun 2022 15 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas feminine and masculine brand personalities and consumer-based brand equity: an explanation through dual mediation model faheem ahmad khan, comsats university islamabad, pakistan muhammad umer quddoos, bahauddin zakariya university, pakistan zara nawaz, comsats university islamabad, pakistan fatima hanif , bahauddin zakariya university, pakistan article details abstract history revised format: may 2022 available online: june 2022 keywords brand gender, consumer-based brand equity, consumer-brand engagement, emotional brand attachment, brand personality currently, it is difficult for marketers to excel by virtuously focusing on traditional marketing approaches. thus, marketing managers are relying more on the gender of the brand, as individuals are more attracted towards those brands which are consistent with their personalities. it has been proposed that brand personality is a crucial source of consumer-based brand equity, but empirical research on the relationship between perceptions of brand personality and brand equity is sparse. considering the importance of brand gender, this study has analyzed the effect of brand gender on consumer-based brand equity through two mediators (i.e., consumer-brand engagement and emotional brand attachment) through an empirical investigation of 299 respondents. the model was shadowed under self-congruity theory. structural equation modelling was utilised to test hypotheses. results show that if managers position their brands based on gender and when there is a match between consumer gender and brand gender, it will engage the customers more and attract them, which helps build consumer-based brand equity. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: umerattari@bzu.edu.pk doi: https://doi.org/10.52461/sabas.v4i1.1022 introduction the continuing revolution of branding in emerging economies remains an under-researched area even though it is of fundamental significance for creating competitive advantage (cho & hwang, 2020; shaalan et al., 2022); at the same time, the nature of branding is changing. developing strong brands is the main objective of every marketing manager (alvarado-karste & guzmán, 2020; veloutsou et al., 2020). at the same time, building brand equity is also a ‘dominant concern for the marketing managers because it is a crucial factor of corporate value’ (zarantonello et al., 2020). digital platforms have gained a pronounced status across the extensive literature in this regard, and in the actual practice of marketing due to the constantly changing and upgraded technology (chen & qasim, 2021), this growing tendency has resulted in the formation of an appealing atmosphere for customers precisely through different social media platforms, at the same time, consumers are also increasingly concerned with how products are brought to them (kirchoff et al., https://journals.iub.edu.pk/index.php/sabas mailto:umerattari@bzu.edu.pk https://doi.org/10.52461/sabas.v4i1.1022 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 16 2019). social media communication, either firm generated or consumer-generated, plays a vital role in supporting brands to build consumer-based substantial brand equity (arya et al., 2021; schivinski et al., 2021). brahmbhatt and shah (2017) and nguyen viet and nguyen anh (2021) reveal that brand awareness and brand associations affect brand equity. due to hyper-competition, firms' offerings have become homogenous, with no significant functional differences, and consumers' choices are increasingly influenced by emotional rather than rational factors (pina & dias, 2021); brand becomes a source of differentiation for companies, with its role expanding from a collection of attributes to a sum of experiences. consequently, it is now difficult for marketers to get brand equity (be) through traditional ways. be both with a financial and perceptual focus has preoccupied researchers for many years (tasci, 2020). nowadays, marketing managers rely more on the gender of the brand as people are more attracted or attached to the brands or products which are consistent with their personalities or gender. after the seminal research of grohmann (2009), many types of research have been carried out on brand gender concept. brand gender is one of the important constructs of brand personality and, above all, the components of brand personality. this study focuses on the effect of brand gender on consumers’ responses to the brand in the social media context. currently, social media has become an essential part of our lives. this study studies the effect of feminine brand personality (fbp) and masculine brand personality (mbp) on consumer responses using facebook and instagram platform. the main reason behind using especially facebook and instagram is that facebook is famous among the people with 2.45 billion active users and instagram also got 1 billion active users (statista, 2020). it is also important to take these sites because most of the fortune 500 companies have their pages on these sites, 90% of fortune 500 companies have their page on facebook while 49% have their page on instagram (statista, 2018). the concept of consumer-brand engagement (cbe) is essential in the social media context as this concept is considered very often in it (cheung, pires & rosenberger, 2020; simon & tossan, 2018). a previous study has demonstrated that cbe in the social media context helps the marketers create value for the brand, and it helps them engage the customers online by giving them timely and relevant content (azar et al., 2016; cheung, pires & rosenberger, 2020). in social media context engagement with a brand, helps the brand build a relationship with customers and thus helps create equity (tsai & men, 2013). according to brand personalities’ conceptualization by aaker, brand personality can affect the emotional brand attachment (eba) (orth et al., 2010). according to huang et al. (2017) there is a significant relationship between brand personality, selfcongruity and eba. previous literature on consumer behavior shows that the brand attachment is connected to consumers’ congruence with the brand and the match between the individual’s actual self and brand personality can greatly affect the eba (malär et al., 2011). in this study the relationship between bg and consumer responses is analyzed by applying the personality theory and self-congruity theory. literature review and hypotheses development personality theory aaker (1997, p. 347) defined bp as the characteristics of humans, related with the brand. even though brands are not living entities but consumers see them as having the characteristics of humans. according to fournier (1998) consumers tend to associate their personalities with the brand because they connect with brands as they connect with their friends or families. bg is an important dimension of brand personality and is considered as an important organizing construct because consumers choose those brands who fulfill their gender identity (avery, 2012). south asian review of business and administrative studies vol. 4, no. 1, jun 2022 17 previous researches have shown that the effect of brand personality on brand loyalty and willingness to pay is positive and both of these are the components of consumer-based brand equity (cbbe) (roy et al., 2016). according to brand personalities’ conceptualization by aaker, brand personality can affect the eba (orth et al., 2010). brand gender is one of the dimensions of brand personality so; it can also affect the eba. marketers tend to match the personality of the brand with consumers personalities to form eba (malär et al., 2011). previous researches have shown that personality traits of an individual can affect the online activities of the brand and particularly influence the use of social networking sites (sns) (ehrenberg et al., 2008). according to the previous studies among the five personality traits, three traits (extraversion, neuroticism and openness to experience) from “the big five” model of goldberg (1981) anticipate the use of sns and their anticipation is connected to liking and commenting behavior of individuals on sns (kabadayi & price, 2014). when the personality of the brand matches the gender of consumer it will generate higher be (lieven & hildebrand, 2016). self-congruity theory according to sirgy (2018), self-congruity is the similarities between the user imagery or brand personality and the self-concept of consumers (actual, ideal, and social self). according to sirgy (1985), self-congruity theory states that individuals choose or buy those products whose user image is consistent with individuals’ self-image. previous researches have shown that when personality of the brand is congruent with individual’s gender then it will generate higher equity (grohmann, 2009). according to lieven and hildebrand (2016) when there is a congruity between the bg and an individual gender then higher brand equity will be generated. previous research has also shown that consumers are attracted to those brands whose gender is congruent with an individual's gender and prefer those brands whose gender characteristics match an individual's gender (lieven & hildebrand, 2016). previous literature shows that there is a linkage between selfcongruency, brand personality and brand attachment (huang et al., 2017). when the brand personality is consistent with consumer’s actual, ideal, and social self than high eba will be generated. the process through which consumers realize the congruity with any brand and then use that particular brand to show their selves, it leads to the formation of eba. previous literature on consumer behavior shows that the brand attachment is connected to consumer’s congruence with the brand, and that the congruence between the consumer's actual self and brand personality can have a substantial effect on the eba (malär et al., 2011). when the congruity between the consumer’s self and brand will be greater than higher eba will be formed towards the brand (huang et al., 2017). lee et al. (2018) postulates that the relationship between brand personality self-congruity and engagement is positive. according to authors, consumers try to compare their personalities with the brands personalities to see if there is any congruity between them. as the inconsistency between the individuals’ personality and personality of brand increases, then consumers will be less engaged with the brand’s facebook and instagram activities for example liking, commenting, and sharing (lee et al., 2018). it is also postulated that if the congruity between consumer’s personality and brand personality is not consistent then consumers will not associate their selves with the brand. brand gender and consumer-based brand equity brand gender is the masculinity and femininity associated with the brand. it is comprised of two independent dimensions, mbp and fbp. fbp consists of more relational personality traits such as they are more connected with interdependence and tender feelings while mbp traits consists of more independent and sturdy feelings (lieven & hildebrand, 2016). aaker (1997) defined brand equity as the set of assets and liabilities associated with a brand, its name and symbol, which add to or detract from the value supplied by a product or service to a corporation and/or its customers. as per the definition of yoo and donthu (2001) individuals respond differently towards the brand south asian review of business and administrative studies vol. 4, no. 1, jun 2022 18 that are known or famous and the unknown brands even the attributes of both are the same. their empirical work shows that brand association and brand awareness can titled as brand awareness/association. as they are treated as one factor so they shape certain brand image (yoo et al., 2000) that helps the marketers in building a distinctive brand attitude and positioning. brand association/awareness is mostly estimated by the communications and interactions between the organizations and customers that takes place on the social media sites (cheung, pires & rosenberger, 2020; schivinski & dabrowski, 2015). different researches have shown that brands who have a higher masculine personality or feminine personality generate more be (lieven et al., 2014; 2015). according to lieven et al. (2014) brand gender influences the be more than any other personality attribute. lieven et al. (2015) also proposed that the effect of mbp and fbp on brand equity is significant. lieven and hildebrand (2016) also tested the effect of brand gender on cbbe across different cultures and countries and their results also shows that higher masculine and higher feminine brands can generate higher be. hence h1a: feminine brand personality has a positive effect on consumer-based brand equity on social networking sites. h1b: masculine brand personality has a positive effect on consumer-based brand equity on social networking sites. brand gender and consumer-brand engagement according to hollebeek et al. (2014, p. 254) the definition of cbe depends upon the customers level of investment when the interaction with particular brand occurs and it is reflected by multiple dimensions of the construct i.e. “cognitive, behavioral and emotional”. this study has followed the behavioral approach to cbe. although most researchers have used the three-dimensional engagement conceptualization but behavioral approach is also used in many studies (schamari & schaefers, 2015). the first step consumer takes towards engaging with a brand is liking the brand page on instagram or facebook and according to previous researches when customers like a brand on facebook or instagram there is a causal effect of it on brand evaluations (beukeboom et al., 2015). when consumers like the facebook or instagram page of their favourite brand or any brand, they are exposed to the brand's message, and as a result, they consume and create brand/productrelated content. according to heinonen (2011) and muntinga, moorman, and smit (2011) the engagement of consumer with brand pages have two important types i.e. consuming and contributing. consuming refers to looking brand-related videos and pictures or reading comments on brand posts or content posted by the brand (muntinga et al., 2011). lurkers are vital to brands (utz & beukeboom, 2011) because they actively use brand pages and absorb material (azar et al., 2016). the brand must encourage the lurkers and make them active users (machado et al., 2019). contributing refers to sharing or commenting on brand-related content (muntinga et al., 2011). likes, comments, and content sharing are considered kinds of word-of-mouth communication. when a user likes, comments on, or shares a brand's post, it displays on their own wall and in their friends' newsfeeds. according to lee et al. (2018), the relationship between brand personality self-congruity and brand engagement is positive. consumers try to compare their selves with the brands and if the consumer’s personality is inconsistent with brand personality then they will be less engaged with the brands online activities. as brand gender is one of the dimensions of brand personality, so when the brand gender is congruent with gender of consumer then they will be more engaged with the brands’ online activities. there is scarce evidence behind the effect of brand gender in dimensional terms on cbe. according to machado et al. (2019) mbp has a significant positive south asian review of business and administrative studies vol. 4, no. 1, jun 2022 19 impact of cbe while fbp has no significant impact on cbe but there is a partial effect of brand gender on cbe. hence: h2a: feminine brand personality has a positive effect on consumer-brand engagement on social networking sites. h2b: masculine brand personality has a positive effect on consumer-brand engagement on social networking sites. brand gender and emotional brand attachment brand attachment is defined as the attachment between consumer, the brand and the feelings towards the brand (malär et al., 2011). feelings towards the brand incorporate affection, passion and connection. according to brand personalities’ conceptualization by aaker, brand personality can affect the eba (orth et al., 2010). marketers tend to match the brand personality with individuals personalities to form eba. according to huang et al. (2017) there is a significant relationship between brand personality, self-congruity and eba. previous literature on consumer behavior shows that the brand attachment is connected to consumer’s congruence with the brand and the compatibility between an individual's actual self and brand personality can have a significant impact on the eba. brand gender is one of the important dimensions of brand personality so it can also affect the eba. hence: h4a: feminine brand personality has a positive effect on emotional brand attachment. h4b: masculine brand personality has a positive effect on emotional brand attachment. consumer-brand engagement and consumer-based brand equity consumer-brand engagement construct is important in this study as this research is executed in social media context and this construct is frequently used in studies related to social media (simon & tossan, 2018). nowadays be is being generated by consumer’s engagement through social media (bruhn et al., 2012). so when consumers interact with brand through social media it shows how involved they are with the brand and thus creates the brand equity (van doorn et al., 2010). hence, the engagement of consumers increases the brand knowledge, which makes the association with the brand strong, favorable and unique, which effects the purchase intention (hutter et al., 2013) and creates the cbbe (algharabat et al., 2020). previous studies have shown that cbe in social media context is crucial as it opens many opportunities for the brand in online context, it helps them in creating value and also in creating the relevant content and creation of new ideas (azar et al., 2016). according to beukeboom et al. (2015) when the individuals are engaged with the brand on social media it can favorably affect the brand evaluation and intention to purchase. which form the significant relationships and thus help in creating be. hence: h3: consumer-brand engagement has a positive effect on consumer-based brand equity. emotional brand attachment and consumer-based brand equity the brand attachment effect on cbbe can be understood by using brand knowledge concept (dwivedi et al., 2018). brand knowledge is the association regarding the brand in consumers mind which changes regarding strength, favorability and uniqueness (keller, 1993) this entire association reflects the cbbe. brand association can be perceived as emotional impressions other than the associations related to product or brand. these emotional impressions are the emotional reactions stored in the individuals mind related to brand-related stimuli (dwivedi et al., 2018). eba helps in devising the emotional impression which increases the salience of brand association and increased brand association is an essential part of cbbe (fedorikhin et al., 2008). according south asian review of business and administrative studies vol. 4, no. 1, jun 2022 20 to keller (1993) when the level of eba is higher it can create the point of difference which can distinguish the brand from its competitors and also enhance the cbbe. so, it can be presumed that eba has a significant positive impact on cbbe, hence: h5: emotional brand engagement has a significant effect on consumer-based brand equity. consumer-brand engagement as mediator between brand genders and consumer-based brand equity as this study has been carried out in the context of social media, it is important to explore the cbe role in the relation between brand gender and cbbe. currently, cbe construct is frequently used in studies related to social media (simon & tossan, 2018). in social media context cbe is important as it opens many opportunities for brands in online context like creating value and creation of new ideas (azar et al., 2016). when the consumer engages with brand through social media, it effects the brand evaluations and creates the cbbe, hence: h6a: consumer-brand engagement mediates the effect of feminine brand personality on consumer-based brand equity. h6b: consumer-brand engagement mediates the effect of masculine brand personality on consumer-based brand equity. emotional brand attachment as mediator between brand genders and consumer-based brand equity eba is treated as a mediator between brand gender and cbbe relationship in context of facebook and instagram. eba is critical in this research because when the individuals personality fits with the personality of brand it can create higher eba (malär et al., 2011) so, when the gender of the brand is congruent with consumer gender than higher eba will formed and according to keller (1993) when the eba is higher, it helps in enhancing the cbbe. according to dwivedi et al. (2018) eba has as direct effect on cbbe. so, when the brand gender matches the consumer gender it enhances the eba which in turn enhances the cbbe. thus, h7a: emotional brand attachment mediates the effect of feminine brand personality on consumer-based brand equity. h7b: emotional brand attachment mediates the effect of masculine brand personality on consumer-based brand equity. figure-1 research model south asian review of business and administrative studies vol. 4, no. 1, jun 2022 21 methodology population sampling and data collection the population of the study is the social media users in pakistan and the sample taken from the population are individuals who engaged with the brand on facebook and instagram. the sampling technique used in this study is non-probability, judgmental sampling. as those respondents are selected for data collecting who are engaging with brand on facebook and instagram. data was collected through online questionnaire and 352 responses are received from the respondents. the instrument used for data collection process in this study is online structured questionnaire with close ended questions. people who use facebook and instagram and are indulged with the brands on these forums were selected for the data collection. for the respondent to answer the questions first they were asked about their usage of internet and the time they spend on facebook and instagram. they were also asked about the number of fashion apparel brand pages they like on facebook and instagram and afterwards they were asked to fill the remaining survey by considering their preferred brand. respondents were asked five qualifying questions before filling the rest of the questionnaire. four demographic questions were also asked from the respondents in section b. the majority of the respondents were female 56.5%. table 2 shows the sample demographics. table 1 sample characteristics variable name values frequency percentage time spent on internet less than 30 min 8 2.7 between 30 min and 1 h 31 10.4 between 1 and 2 h 57 19.1 more than 2 h 203 67.9 time spent on facebook less than 30 min 165 55.2 between 30 min and 1 h 55 18.4 between 1 and 2 h 36 12.0 more than 2 h 43 14.4 time spent on instagram less than 30 min 112 37.5 between 30 min and 1 h 69 23.1 between 1 and 2 h 50 16.7 more than 2 h 68 22.7 number of online brands pages liked on facebook fewer than 10 brand pages 166 55.5 between 11 and 20 brand pages 55 18.4 between 21 and 30 brand pages 35 11.7 more than 30 brand pages 43 14.4 number of online brands pages liked on instagram fewer than 10 brand pages 161 53.8 between 11 and 20 brand pages 63 21.1 between 21 and 30 brand pages 26 8.7 more than 30 brand pages 49 16.4 table 2 sample demographics variable name values frequency % variable name values frequency % age 16-22 94 31.4 education fa/fsc 14 4.7 23-28 177 59.2 bachelors 154 51.5 29-35 20 6.7 masters 107 35.8 36-45 6 2.0 others 24 8.0 46-70 2 0.7 job status full-time 85 28.4 gender male 130 43.5 student 148 49.5 female 169 56.5 not working 66 22.1 measures south asian review of business and administrative studies vol. 4, no. 1, jun 2022 22 the measure utilised in this study was a five-point likert scale ranging from 1 (strongly disagree) to 5 (strongly agree). the instrument used for the data collection was structured questionnaire with close ended questions adopted from the previous studies. the scale adopted to measure the construct of brand gender was 12-items scale developed by grohmann (2009). it is sub-divided into mbp and fbp six items each. the scale used to measure cbe has two indicators consuming and contributing with 3 items of consuming and 4 items of contributing. we did not include the final item, liking the company's facebook page, because we only chose respondents who had already liked the brand's facebook page. the scale for measuring eba is developed by thomson et al. (2005). eba is a multi-dimensional variable. 10 items were used to measure it. the forth variable in the questionnaire was cbbe, which is brands added value and is conceptualized by yoo and donthu (2001) on the basis of dimensions like: brand awareness/association, perceived quality and brand loyalty. it was being measured using the scale which includes 4-items and developed by yoo and donthu (2001). analysis and results data normality checks the key assumptions regarding normality were checked as shown in table 3 table 3 data normality statistics (n=299) constructs min max skewness se kurtosis se tolerance vif fbp 8.00 20.00 -0.52 0.14 0.11 0.28 0.89 1.12 mbp 8.00 20.00 -0.16 0.14 -0.29 0.28 0.86 1.15 cbe 6.00 30.00 0.07 0.14 -0.12 0.28 0.83 1.20 eba 13.00 35.00 -0.22 0.14 -0.16 0.28 0.69 1.43 cbbe 7.00 20.00 -0.17 0.14 0.06 0.28 dependent variable notes: fbp= feminine brand personality; mbp= masculine brand personality; cbe= consumer-brand engagement eba= emotional brand attachment; cbbe= consumer-based brand equity; se=standard error; vif=variance inflationary factor measurement model (measure validation) reliability and unidimensionality numerous goodness-of-fit indices, such as those recommended in the sem literature, were employed (hu & bentler, 1999; sila & ebrahimpour, 2005) such as χ2/df; gfi, nfi, cfi, rmr and rmsea. prior to analyzing path model the measurement model was developed to check unidimensionality. reliability and validity of the items was also measured. table 4 shows the results of individual cfa. few items with extreme low fl were deleted. to get better fit indices some error terms were also correlated like ℮5↔℮6, ℮4↔℮6, ℮3↔℮5 and ℮2↔℮4 of cbe and ℮4↔℮7, ℮6↔℮7, ℮2↔℮6 and ℮1↔℮2 of eba. the value of cronbach alpha α for all the variables are greater than 0.7 which means the items are error free and the value of cfi, gfi and nfi are also greater than 0.9. table 4 results of individual cfa (n=299) constructs items unidimensionality convergent validity reliability χ2/df gfi cfi rmr rmsea nfi fl (min-max) α fbp 4 2.54 0.99 0.98 0.01 0.05 0.97 fl (0.52-0.78) 0.70 mbp 4 0.20 0.99 1.00 0.00 0.00 0.99 fl (0.57-0.81) 0.77 cbe 6 2.00 0.98 0.99 0.03 0.05 0.98 fl (0.56-0.76) 0.81 eba 7 1.99 0.98 0.99 0.01 0.05 0.98 fl (0.51-0.88) 0.87 cbbe 4 2.50 0.98 0.98 0.02 0.05 0.97 fl (0.58-0.73) 0.72 notes: fbp= feminine brand personality; mbp= masculine brand personality; cbe= consumer-brand engagement eba= emotional brand attachment; cbbe= consumer-based brand equity; gfi= goodness of fit index; cfi= comparative fit index; rmr= root mean square residual; rmsea= root mean square error approximation; nfi= normed fit; fl= factor loadings; α = cronbach’s alpha south asian review of business and administrative studies vol. 4, no. 1, jun 2022 23 the method given by (fornell & larcker, 1981) was used to test discriminant validity; if the square root of the ave of a construct is greater than its correlation coefficient with other constructs, then the construct is regarded to be distinct from the other constructs. according to table 5, all constructs satisfy this criteria of discriminant validity. table 5 discriminant validity (covariance among latent variables) (n=299) constructs fbp mbp cbe eba cbbe mean sd fbp 0.48† 0.13** 0.13** 0.33** 0.16** 13.92 2.36 mbp 0.41† 0.22** 0.35** 0.20** 14.22 2.76 cbe 0.43† 0.40** 0.18** 17.60 4.50 eba 0.48† 0.43** 25.57 4.55 cbbe 0.47† 13.73 2.58 notes: fbp= feminine brand personality; mbp= masculine brand personality; cbe= consumer-brand engagement eba= emotional brand attachment; cbbe= consumer-based brand equity ** correlation is significant at 0.01 level (2-tailed; †√ (ave) values in the diagonal; sdstandard deviation after running the individual cfa, nested cfa was also analyzed. to get better fit indices some error terms were also correlated in five factor nested model like, ℮13↔℮14 of cbe were correlated. convergent validity has been explained by bagozzi and phillips (1982) as the level of agreement of results if same construct is measured multiple times. the bentler-bonett nfi was calculated to fulfill the first method of finding model fit. table 6 shows nfi value of 0.91 which means that all the latent variables nfi’s are > 0.90 benchmark. the second method recommends that estimates of factor loadings should be ≥ 0.5. results of five factors nested cfa can be seen in following table 6. table 6 five factors nested cfa (n=299) unidimensionality convergent validity reliability indicators χ2/df gfi cfi rmr rmsea nfi fl [min-max] α 25 1.78 0.90 0.92 0.04 0.05 0.91 fl [0.52-0.86] 0.86 notes: χ2= chi square; df= degree of freedom; nfi= normal fit index; cfi= comparative fit index; rmr= root mean square residual; rmsea= root mean square error of approximation; fl= factor loadings; α = cronbach’s alpha. hypotheses testing direct and indirect effects to test the fit of the two structural models, a variety of goodness-of-fit indices, such as those recommended in the sem literature, were employed (hu & bentler, 1999; sila & ebrahimpour, 2005) such as χ2 / df; gfi, nfi, cfi, and rmsea. we estimated the paths from exogenous variable to different endogenous variables. figure 2 shows the direct and indirect effect models. in directeffect model we estimated the paths from cbe to cbbe, mbp to cbbe, eba to cbbe and fbp to cbbe. h1a stated that there is a significant effect of fbp on cbbe. the results shows that there is no significant effect of fbp on cbbe (h1a: β=0.04, p=0.10) so h1a is rejected. h1b stated that there is a significant effect of mbp on cbbe. the results shows that again there is no significant effect of mbp on cbbe (h1b: β=0.08, p=0.58) so h1b is also rejected. h2a stated that there is a significant effect of fbp on cbe. the results shows that there is a significant effect of fbp on cbe (h2a: β=0.22, p=0.005) so the h2a is accepted. h2b stated that there is a significant effect of mbp on cbe. the results shows that there is a significant effect of mbp on cbe (h2b: β=0.26, p<0.01) so the h2b is accepted. h3 stated that there is a significant effect of cbe on cbbe. the results show that there is no significant effect of cbe on cbbe (h3: β=0.00, p=0.46). so h3 is rejected. h4a stated that there is a significant effect of fbp on eba. the results shows that there is a significant effect of fbp on eba (h4a: β=0.36, p<0.01) so the h4a is accepted. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 24 figure-2 direct and indirect effect models h4b stated that there is a significant effect of mbp on eba. the results shows that there is a h4b stated that there is a significant effect of mbp on eba. the results shows that there is a significant effect of mbp on eba (h4b: β=0.34, p<0.01) so the h4b is accepted. h5 stated that there is a significant effect of eba on cbbe (h5: β=0.48, p<0.01). hence, h5 is also accepted. regarding mediation related hypotheses like h6a: fbp→ cbe→cbbe, h6b: mbp→ cbe→cbbe, h7a: fbp→ eba→cbbe and h7b: mbp→ eba→cbbe. we compared the model fitness values of direct and indirect models, as can be seen in table 6 that there are improved and better fit indices. with these improved values it can be establish that cbe and eba mediates the effects of fbp and mbp on cbbe. after comparing both the models we can conclude that h6a, h6b, h7a and h7b are also accepted. table 6 results of structural equation analysis for two competing models the relationships between variables direct effect model indirect effect model β s.e β s.e h1a: fbp→ cbbe 0.04 0.06 insignificant h1b: mbp→ cbbe 0.08 0.07 insignificant h3: cbe→ cbbe 0.00 0.05 insignificant h5: eba→ cbbe 0.48** 0.07 significant h2a: fbp→ cbe 0.22 0.10 significant h2b: mbp→ cbe 0.26 0.11 significant h4a: fbp→ eba 0.36 0.10 significant h4b: mbp→ eba 0.34 0.10 significant model comparison indices between direct and indirect effect models h6a: fbp→ cbe→cbbe h6b: mbp→ cbe→cbbe h7a: fbp→ eba→cbbe h7b: mbp→ eba→cbbe χ2 584.632 500.7 df 270 266 χ2 / df ratio 2.17 1.88 gfi 0.86 0.90 nfi 0.81 0.91 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 25 cfi 0.88 0.91 rsmea 0.06 0.05 r² (cbe) 0.00 0.13 r² (eba) 0.00 0.27 r2 (cbbe) 0.24 0.26 notes: fbp= feminine brand personality; mbp= masculine brand personality; cbe= consumer-brand engagement eba= emotional brand attachment; cbbe= consumer-based brand equity; χ2= chi square; df= degree of freedom; χ2 / df = chiχ2 / df square ratio; nfi= normal fit index; cfi= comparative fit index; rmsea= root mean square error of approximation discussion and conclusions the first hypothesis infers that there is a significant relationship among brand gender and cbbe. some previous researches also showed mixed results regarding the effect of brand gender on cbbe (machado et al., 2019). although brand gender has an indirect effect on cbbe, through cbe and eba, brand gender affects the cbbe. so, it can be inferred from these findings that brand gender may have no direct impact, means no positive assumptions and recognition in the mind of consumers but, when the brand gender engages and attract the individuals first then it can enhance the cbbe. to engage the consumers online is not an easy job. marketers needs to be vigilant towards all the opportunities and should try to forge an emotional relationship with the brand by engaging with them timely. in the study cbe mediates the relationship between brand gender and cbbe which means individuals are consuming and contributing towards the brand gender stimuli on the sns. attaching individuals with brand is not an easy undertaking as they will not be attached with brand unless there is a fit between the personalities of individual and brand. in the study eba mediates the relationship between brand gender and cbbe that means individuals think of brand as a part of their selves and with the help of brand positioning individuals attach with bran which thus generates the equity. in most of the studies gender is used as a moderator as it helps in analyzing the results for instance it can tell that how females behave towards certain relations and how male reacts towards certain relations. industry is also important because may be females and males do not show different behaviors towards fashion clothing brands but may behave differently towards brands from different industries. in today’s dynamic markets it is difficult for marketers to attract and retain the consumers. marketers are using different techniques to attract the consumers. one the most important technique by which consumers can be attracted and engaged is positioning the brand on the basis of their gender. many researches have shown that when the personality of the consumers match the brand personality they attach with the brands for the long term (malär et al., 2011). as attachment theory states that individuals emotionally attach with the things like pets, people, or brands for the long time so when consumers think that their personalities match with the brand personality they will be more attracted with the brand. as gender is one of the dimensions of brand personality so it can also create consumers attachment with the brand. another technique to attract and engage the customer is the congruence between the gender of the brand and the gender on the individual. congruity theory states when there is congruence between the individual and brand it forms the long-term relation and it is easy to attract individuals through it. when the individual’s self is consistent with brand’s self the consumer will engage more with the brand and attract more consumers while forming the cbbe. attracting and engaging consumers are easy on sns as brands should run their pages in a way that clearly shows that the brand is muscular or feminine. when the brands online presence shows the clear gender of the brand then it will attract and engage the consumers more effectively. for engaging consumers on sns is difficult yet if we once cultivate the favorable relationship with the south asian review of business and administrative studies vol. 4, no. 1, jun 2022 26 individuals it will be easy for the brands to engage with the individuals in future. marketers should try to engage individuals online by giving them timely responses or by keeping in touch with them more frequently. for engaging the individuals, marketers should use clear gender positioning, their page outlook, colors, fonts, shapes, technicalities and even posts should show the clear gender positioning. marketers always try to enhance the equity of the brand through different techniques. positioning the brand on the basis of its gender can enhance more equity than other techniques. when the brand is positioned on the basis of its gender it will affect the association of consumer towards the brand and consumer will remember the brand more easily. when consumer can easily recall the brand and recognize it easily because of the gender positioning then be will be generated because of bg. when individuals have a positive association in their minds regarding the brand, then higher cbbe will be generated. theoretical and managerial implications previous studies have clearly shown that fbp and mbp significantly affect cbbe which means the more the brand will be muscular or feminine, the higher will be the equity (lieven et al., 2015). this research contributes in the previous work by showing the effect of two mediators cbe and eba on the association between brand gender and cbbe. the findings show that the model with mediators shows 26% of variation in cbbe while the model without mediators shows 24% of variation in cbbe. in this study, cbe and eba had a substantial impact on the association among brand gender and cbbe. therefore, this research will contribute to the literature on brand gender by enhancing our understanding of the association among brand gender and cbbe. this study also contributes in the literature of brand gender as it shows the empirical evidence of the mediating effect of cbe in the relationship of bg and cbbe. the evidence shows that brand gender has a positive effect on cbe. the findings show that brand gender brings 13% of variation in cbe. cbe also significantly affect the relationship of brand gender and cbbe. this research also analyzed the effect of cbe on cbbe but cbe does not have any significant impact on cbbe. this study also contributes in the literature of brand gender as it shows the empirical evidence of the mediating effect of eba in the relationship of brand gender and cbbe. the evidence shows that brand gender has a positive effect on eba and these results may contribute in the literature of brand gender also, eba significantly affect the relationship of brand gender on cbbe. the findings show that brand gender brings 27% of variation in eba. this relationship is also important as many researchers believe that brand personality has a positive impact on eba but until now very few have studied the effect of brand gender on eba. hence this study also extends the previous studies by suggesting that strongly gendered brands can attract the consumers more by forming eba. this research also analyzed the effects of eba on cbbe and contributes in cbbe literature as when the consumer is attached with the brand, it will generate more equity. this relationship supports the previous studies that eba has a significant effect on cbbe and also contributed in the theory as that relationship was not analyzed in the context of facebook and instagram. this study entails certain managerial implications as well. firstly, the findings of this study show that for attracting consumers, gender is an important aspect. if managers position their brands on the basis of brand gender and when there is match between consumer gender and brand gender it will engage the customers more and attract them which in turns helps the building of cbbe. managers can highlight the gender of the brand through various ways for instance managers make their logos or names in a way that it depicts the gender of the brand and change the perception of individuals about the brand. they can also use the masculine or feminine spokespersons to south asian review of business and administrative studies vol. 4, no. 1, jun 2022 27 highlight the gender of the brand. managers can also use in store settings or dresses of sales representatives to enhance individual’s perception about the gender of the brand. managers can also ensure individuals perceptions about the brand by using specific marketing campaigns. managers can also affect the perception of consumers through social media as the outlook of brand pages can enhance the perception of individual about the gender of the brand. the colors, brand social media posts, shapes etc. also made the perception of individual about the gender, if the brand is feminine then manager should use the lighter, bright or more colors and less technicality while for masculine brands manger should use darker and few colors and more technicality on social media sites. managers should also try to maintain a relationship with consumers through social media sites, as the active engagement will attach the consumers emotionally with the brand. managers should be vigilant about all the opportunities which help the brand in creating the emotional attachment with the brand. limitations and future directions this study has used the closed-ended questions to collect the data rather than the open-ended questions. if we had used the open-ended questions respondents might have more willing to complete the survey. the sampling technique is also an important limitation as the technique used is non-probability sampling and the sample profile was also considered as an important limitation as the respondents were mostly youngsters who use facebook and instagram but, for the generalizability, research should also 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(2020). how consumer-based brand equity relates to market share of global and local brands in developed and emerging countries. international marketing review, 37(2), 345–375. https://doi.org/10.1108/imr05-2018-0176 south asian review of business and administrative studies vol. 1, no. 1, june 2019 41 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 1, no.1, june 2019 journal homepage: https://journals.iub.edu.pk/index.php/sabas role of brand experience in building brand loyalty: mediating role of brand trust and brand commitment saif ur rehman, technical education and vocational training authority, pakistan. muhamamd shafiq, faculty of management sciences, foundation university, pakistan article details abstract history revised format: may 2019 available online: june 2019 keywords brand experience, brand commitment, brand trust, brand loyalty, and sportswear the motive of our study is to investigate the influence of brand experience on brand relationship, that successively influence their brand loyalty of sportswear. the study additionally tests whether or not brand service quality moderates the relationship between brand experience and brand commitment. data collected via survey form from 304 athletes who were buying sportswear apparel and clothing. spss and amos versions 21 were used. brand trust is the vital component of brand commitment. brand experiences, commitment, trust have positively affected brand loyalty according to this study. brand commitment and brand trust mediate the relationship between brand experience and loyalty. brand service quality has a moderate impact on the relationship between brand experience and brand commitment. this study is conducted in a limited geographical area in the context of the sportswear industry. this model may be extended in various contexts and countries for future study. the study of branded sportswear products provides insights into the effective strategies used in the fields of sportswear to enhance brand commitment, brand trust and brand loyalty. it started with previous works and explored various facts about brand experience and brand loyalty, so it examined these two buildings more deeply than previous studies and saw their results. it reveals the validity of the brand resonance model, key mediating variable (kmv) model, particularly in sportswear industry. © 2019 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address:saifurrehman514@yahoo.com doi: https://doi.org/10.52461/sabas.v1i1.442 introduction the last three decades show marketing research has impacted customer-brand connections (chang and chieng 2006). several kinds of research have shown that involving consumers along a brand is a crucial process for establishing firm relationships between consumers and brands (hollebeek 2011) and a primary metric for brand quality improvement (kumar, aksoy et al. 2010). in today's dynamic world in which customers have immense brand options, the sustainability of businesses needs to develop and sustain brand loyalty. the booming internet and mobile technology that has contributed to customer’s being able to switch brands https://journals.iub.edu.pk/index.php/sabas mailto:saifurrehman514@yahoo.com https://doi.org/10.52461/sabas.v1i1.442 south asian review of business and administrative studies vol. 1, no. 1, june 2019 42 continuously has educated savvy consumers more than ever. for companies that rely on their brand’s selling power, this is expensive and inefficient. to distinguish between rivals, businesses must produce a thrilling brand experience that inspires consumers to buy consistently and stay true to the brand. consumers respond to the attitude that the brand conveys and establish secure links with the brand from these brand interactions. brand experience is a term that has recently acquired importance subjective internal user responses and behavioural reactions (sensations, emotions, and cognition) conveyed by brand stimuli are formally categorized. in building strong brand value, a fresh frontier is seen as the brand experience (brakus, schmitt et al. 2009). in different ways, brand knowledge can be applied, for instance retailing (dolbec and chebat 2013) services (nysveen, pedersen et al. 2013), and development services (nysveen, pedersen et al. 2013). (tafesse, nauri, & korneliussen,2014). different products and services are built to establish their impressive impressions with the growing value of customer impressions, for instance iphone of apple, body shop, harley davidson, theme parks of diseny , and w hotels (pine and gilmore 2011). the consumer acquisition of companies, an important marketing tactic, seeks to emphasize their brand experiences, from the functional advantages of customers. this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). because of unique service characteristics (such as intangibility and heterogeneity), product-based brand equity, it is argued that adjustment is needed to meet the criteria for hospitality service brand evaluation (nam, ekinci et al. 2011). also, recent researches has analyzed the correlation between brand credibility and brand confidence ((park, lee et al. 2014), no research has examined the role of brand trust and brand engagement in the relationship between consumer-based sportswear brand experience and brand loyalty in the sportswear sectors to the best of our knowledge researchers view brand confidence as an important factor in the sportswear industry, specifically for safety purposes. also, confidence is the one of the common assessments of brand-consumer relationships and can be a key predictor of brand equity (song, hur et al. 2012). according to (alam and yasin 2010) consequently, customers also prefer affordable and trustworthy sportswear. as most of the customers rely on the trust of the this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). in other words, by approving into the account the general brand equity, brand trust, and brand commitment, customers are seeking to reduce insecurity and anxiety. building the brand loyalty in the sportswear industry, it is therefore key to study the relation among the brand experience, brand commitment, and trust further. the purpose of this study aims to: (1) to define the brand experience' fundamental dimensions; (2) to experimentally analyse the relationship between brand experience, brand commitment, and brand trust, explore the mediating role of brand trust and brand commitment in brand experience and brand loyalty; and (3) to compare the brand experience dimensions evaluations with various customer visits to fill the important gap. the findings can describe how brand experience can be efficiently used to target customers and to better understand how brand expertise dimensions can be used accordingly for customer visits. thus, the current study will create highly successful targeting strategies. however, in terms of the reputation of the brand experience (be) and customer brand loyalty (bl) the uncommon marketing literature has addressed intermediate processes amongst these two constructions. this study describes how two key broker of brand trust and commitment are linked to brand experience and loyalty while filling the gap. researchers view brand trust as an important factor in the sportswear industry, particularly for safety. trust is also the main south asian review of business and administrative studies vol. 1, no. 1, june 2019 43 predictor of the relationship between brand and customer and can be a primary prover of brand equity (song, hur et al. 2012). literature review brand rresonance model the brand resonance model explains that brand resonance, such as brand loyalty will gradually be accomplished through two paths, i.e. emotional and rational (keller, parameswaran et al. 2011). the rational path includes significant elements, including performance (for instance payment, cost-effectiveness, durability, reliability), judgment (for instance, quality, credibility), at the same time as emotional one consist of those, for instance, imagery and feelings (e.g., fun, excitement) (keller, parameswaran et al. 2011). many causes ease the choice of brand trust and brand commitment, at the respective path such the mediators to brand loyalty. brand commitment is therefore ideal as a mediator of this study due to the peerless composition of brand commitment, incorporated complicated emotions, while brand trust is presented as the key mediator on the brand loyalty model in prior literature, which is chosen in this research. these mediators reflect the reasonable and emotional part in brand connection quality respectively (brq) (fournier 1998). brand experience the definition of brand experience is explored for the first time in the study (pine, pine et al. 1999). for this research, the definition is adopted from brakus, schmitt et al. (2009), he mentioned that brand impressions are instinctive, internally evoked, customer reactions (sensation, feelings, and cognitions, and behavioural responses), caused by brand-related sensations, the brand's layout, packaging, communication, and environment. it differs in its strength, intensity, and probably either positive or negative, with larger effects on consumer behaviour (brakus, schmitt et al. 2009). also, the construct is similar to yet theoretically different from various attitudes toward brands, for instance, brand perspective, association and brand attachment (brakus, schmitt et al. 2009). brakus, schmitt et al. (2009) proposed different forms of experiences such as, brand visual, affective intelligent, and behavioural experiences. brand trust marketing relationships brand trust, especially its traverse customer (laroche, habibi et al. 2012). brand trust is described in this study by prior literature as 'feeling the consumer's security as it enters into a relationship with the brand consist on the belief about the brand's trustworthiness and accountability for the delight and benefit of the consumer (delgado ballester, munuera-aleman et al. 2003). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). brand commitment according to suh and han (2003), the brand that provide users a feeling of warmthless and friendliness are ready to have a good and sustainable affective relationship with such brands and relates to a long-term will to maintain a link with the brand. customers with a widespread commitment to brands are a stronger tool for the company around the time (keh, nguyen et al. 2007). commitment has two types 1affective and 2continuance commitments. the emotional connection to a brand expressing a deep sense of personal identity is emotional engagement. affective brand involvement concentrates on brand identity and brand values (pring 2007). (mcalexander, kim et al. 2003) found an affective commitment to assessing the emotional commitment of certain important brands, describing the immense commitment to the focussed brands. (verhoeff 2009) analyse that direct effect of affective commitment to again purchase the product purpose has been noticed in banking services. brand loyalty, brand value, have been a history of commitment, but do not specifically influence customer repurchase behaviour. continuance commitment is referred to as the consumer's poor emotions for a brand. since customers are concerned about big turnover prices and some other options, they are changing south asian review of business and administrative studies vol. 1, no. 1, june 2019 44 their brands. (fullerton 2005) explained continuance commitment allows customers to be less likely to engage in advocacy intention. in previous studies on commitment, (lindstrom 2005) examined brand commitment. in this research, customers are asked if they "tatoo the brand name on their body." several customers were led to tattoo the image of brands on their bodies by studies. studies of engagement and repurchase plans in (harrison-walker and coppett 2003) have revealed continued customer response commitments, but consumers with aesthetic participation are a source of a brand or organization and continue to support a company because of its deep affectionate relationship. a model developed by fullerton (2005) explaining the role of brand interaction, both affective and continuous, their research found that continuance commitment has a poor effect on the intention to purchase the product again, and the literature indicated that driving emotional loyalty is prohibited due to attitudinal loyalty. for other researchers, continuance commitment is correlated with the possibility of repurchasing. brand service quality the association among the brand service quality and the behavioural consequences has gained a lot of attention in the literature (rauyruen and miller 2007). scholars have found the effect of the quality of this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). moreover, a significant symbol of scholars discussed that brand service quality is a significant factor for brand loyalty, although it has remained uncertain about its exact relation (harris and goode 2004). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). brand loyalty the literature includes two aspects of brand loyalty. the stochastic view suggests that consumers exhibit spontaneous actions in a way that does not affect past buying behaviours. the deterministic view, however, suggests the brand loyalty is due to external factors’ influences. while this is interesting, the standard of cognitive processes in influencing brand loyalty tends to be underestimated (jacoby and chestnut 1978). in this sense, brand loyalty studies do equally consider external behaviors into consideration and also the rationales or perceptions of customers towards them (odin, odin et al. 2001). this research bridges the void in the literature on customer behaviour, by combining behavioural and attitudinal aspects of brand loyalty (jones and taylor 2007). this research describes the commitment of behaviour as the persistent purchasing of a downloaded brand by consumers and their repeated intent to purchase the product this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). brand experience & brand commitment at the same time, the current study often indicates a strong correlation between brand experience and brand association (ramaseshan and stein 2014). consumers' perceptions of brand experiences contribute to pleasurable results because consumers like to relive these enjoyable experiences again. customers with affirmative brand experience should purchase brand loyalty again, i.e., endorse the loyalty to the attitude and never switch to other products (chaudhuri and holbrook 2001). they possibly tend to make the buyer more loyal and dedicated to this particular brand with a higher value proposition. a good experience of a brand can also lead to an emotional or cognitive attachment and ultimately become repetitive behaviour (zarantonello and schmitt 2010). h1: brand experience has a significant positive influence on brand commitment. south asian review of business and administrative studies vol. 1, no. 1, june 2019 45 brand experience and brand trust this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). the concept of trust that comes from the theories on personal interactions, is implicit in every significant social relationship since it is rooted in the field of social psychology (morgan and hunt 1994). personality and social science theory also often claim that trust emerges from personal encounters and previous relationships (rempel, holmes et al. 1985). (ha and perks 2005) in an e-consumer success analysis, brand trust was found via knowledge searches and different brand experiences. (lee, kang et al. 2014) also examined online hotel brand experience has a significant and positive effect on trust in the hotel brand. cantered on the aforementioned argument, the analysis concludes that: h2: brand experience has a significant positive influence on brand trust brand commitment and brand loyalty in a relationship, marketing studies commitment is a key idea (fullerton 2005) and is described as a "strong wish to keep an esteemed relationship" (moorman, zaltman et al. 1992). many scholars have identified the value of commitment when developing and sustaining business relationships this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). h3: brand commitment has a significant positive influence on brand loyalty. brand trust and brand loyalty second, trust has been viewed as a behavioural intention or behaviour that reflects a reliance on a partner and involves vulnerability and uncertainty on the part of trustee. this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015. based on these findings the following hypothesis is suggested. h4: brand trust significantly positively influences brand loyalty south asian review of business and administrative studies vol. 1, no. 1, june 2019 46 brand trust and brand commitment according to (garbarino and johnson 1999) trust is commonly considered a significant history of commitment in relational marketing studies. trust effects attitude loyalty as well as purchasing loyalty in consumer marketing (chaudhuri and holbrook 2001). hence: h5. brand trust has a significant positive influence on brand commitment. brand experience and brand loyalty providing exclusive and unforgettable brand experiences enables consumers to build a lifelong affection for the brand, which results in frequent visits and loyalty to the brand (brakus, schmitt et al. 2009). prior empirical findings have shown that memory of a brand experience is a significant indicator of brand loyalty. for instance, (iglesias, singh et al. 2011) arguing that brand loyalty is the result of positive brand experience with affective commitment as a mediation. studies have also shown that the creation and management of exclusive brand experiences is key to improving the loyalty of service brands and retail brands (khan and rahman 2015). based on previous literature research that shows the positive impact of brand experience on brand loyalty (francisco-maffezzolli, semprebon et al. 2014). this research argues that brand experiences are strongly linked to brand loyalty. h6: brand experience has a significant positive influence on brand loyalty. mediating role of brand commitment by taking the mediational hypothesis route, we suggest that when customers experience a brand, they are inspired by a series of brand-related self-relevant stimuli to incorporate the brand to themselves and then activates brand commitment. brand influences can be considered as an important factor for exploring brand commitment which triggers behavioral outcomes of brand commitment (carroll and ahuvia 2006). accordingly, we conclude there is an indirect correlation between brand experience and brand loyalty by brand commitment. thus, we propose that: h7. brand commitment mediates the relationship between brand experience and brand loyalty. mediating role of brand trust (delgado-ballester, munuera-aleman et al. 2003) suggest that the consumer assessment of both direct and indirect experience with the brand is the key component of the brand trust. specifically, the satisfaction of consumers with brand performance reflects the strength of brand trust for customers. further, marist, (marist, yuliati et al. 2014) conclude that customers' commitment to re-buy the brand is enhanced by the high brand trust. therefore, based on this argument, we hypothesize: h8. brand commitment mediates the relationship between brand experience and brand loyalty. moderating role of brand sevice quality service quality is a cantered assessment that represents consumer expectations of service elements like interaction quality, quality of the physical environment, and the quality of the results. the following aspects are measured according to those dimensions of this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). service quality is described as the universal assessment or attitude of service excellence or primacy of the service (brady and cronin jr 2001). service quality is described as a feeling that the service is excellent or superior (brady and cronin jr 2001). the association between service quality, brand trust, and loyalty was specifically based on little empirical south asian review of business and administrative studies vol. 1, no. 1, june 2019 47 research. a systematic, multi-dimensional framework of consumer behavioural intentions in services with respect to behavioral intentions in a business context was proposed by (bitner, faranda et al. 1997). initially, the following four major facets of this framework were: word of mouth communication, the desire to buy, price awareness, and complaining behaviour. the discussions which are mentioned earlier indicate the underlying hypotheses: h9: service quality has a moderator effect between brand experience and brand commitment. research method data collection a survey was conducted on a sample of 304 selected sportswear users; for this purpose, research is predicated and developed through the implementation of an independent questionnaire. data collection was administered in pakistan, from the world of punjab i.e. multan, lahore, islamabad city; sportwear athletes were asked to participate during this research to collect information about the brand loyalty. the current research uses a purposeful sampling method. use the processed data and statistical analysis in the questionnaire based on the analysis of amos covariance sem. the details of the analysis are as follows. first, to analyze the characteristics of the sample, and second to verify the reliability of the problem. therefore, third, the impact of the relationship between brand trust on brand experience, brand commitment (bc), brand trust and brand loyalty there is influence. to achieve this goal, we adopted a resonance model with five structures, which will be achieved through a questionnaire survey. measures the survey tool has three main purposes. the first is to study brand experience based on brand loyalty to emphasize brand brand trust and brand loyalty; the second is to study brand experience to build trust and commitment based on brand name loyalty, so the last one is different information about people with characteristics. who will understand different situations in different classes? this research survey consists of two parts, the main part includes such individual variables and population-related variables. and the second part includes the variables under study. these variables include brand experience, brand commitment, brand trust, quality of brand service and brand loyalty. the theories in this section are based on previous literature, and questionnaires have been established and used. the scale of this study is derived from previous literature and published research. the key variables include 12 questions, and the scale of the brand experience is modeled on brooks et al (2009). the second variable brand commitment contains four questions and this scale was adapted from knox & walker 2001:2003. the third brand trust contains five questions and this scale was adapted from ( matzler 2008); chanduhuri and holbrook (2001). the fourth variable brand south asian review of business and administrative studies vol. 1, no. 1, june 2019 48 loyalty contains six questions and this scale was adapted from algesheimer, uptal and herrmann, 2005: fullerton, 2005). the fifth variable brand service quality contains five questions and this scale was adapted from brady and cronin, 2001; parasuraman et al, 1988; terblanche and boshoff, 2001. explain the purpose and content of the research from the beginning or before the questionnaire is presented so that they can easily fill in the acceptable answers to the questionnaire. question mark x was selected after data collection, so the remaining question marks were not included in the study because the questionnaire was incorrect and incomplete. sort the variables according to the five-point paint level (1 = strongly disagree, 2 = disagree; 3 = neutral, 4 = agree 5 = strongly agree). with this entry, amos (multiple structure analysis) aims to highlight many of the basic knowledge and practical functions of statistical modules. empirical results sample demographics athletes' responses were getting by survey questionnaires. a complete of 304 complete questionnaires were received which help conduct analysis. the total sample sizes are 304 individuals of which 195 males (64.1%) and 109 females (35.1%). moreover, investigate concerning the age of sportswear athletes; 1.6% of the respondent were below 16 years of age, 13.8% were among 16-20 years, 34.2% were among 21-27, and 39.1% were of age greater than 28-34 11.2 % were above 40 years. further when investigated concerning the education level of respondents; 4.3 % of athletes were below matric, 24.3 % were intermediate, 41.8 % were bachelor, 29.6 were master or above. when inquired about how many years you are in sports? 5.6% of the athletes were 1-3 years in sports, 30.9% were 3-5 years, 63.5 % were above 05 years. when inquired about what sports do you play? 28.3% were playing volleyball, 21.7% were playing badminton, 23 % were playing football, 19.7 % were playing table tennis,7.2 % were playing basketball. when inquired about at which level you play sports;14.8% of athletes were playing at recreational level, 57.9 % were playing domestic level, 26.6 % were playing national level, 0.7 % were playing international level. when inquired about do you prefer to wear branded sportswear: 100% of athletes answer yes. when inquired about which brand you prefer to use: 35.5 % of athletes were using nike brand, 25.3 % athletes were using adidas brand,18.4 % athletes were using puma brand, 3.6 % athletes were using asics brand, 2.0 % athletes were using reebok brand, 2.6 % athletes were using converse brand, 3.6% athletes were using bata brand, 8.6 % athletes were using service brand,0.3 % athletes were using other brands. when inquired about how many years using this brand; 7.6 % of the athletes were 1-2 years, 16.4 % were 3-4 years, 41.6 % were 1-2 years, 34.5 above 06 years. when inquired about how many times do you participate in sports and physical activity a week; 9.5 % of the athletes were 1-2 times, 28.6 % were 3-4 times, 61.9 % were 5-6 times. when inquired about how many hours do you practice a day? 33.9 % of the athletes were 1-2 hours, 45.7 % were 3-4 hours, 20.4 % were 5-6 hours. the summary is provided in the following table. table sample characteristics (n =304) demographic variable frequency percentage gender male 195 64.10% female 109 35.90% age below 16 years 16-20 years 5 42 1.60% 13.80% south asian review of business and administrative studies vol. 1, no. 1, june 2019 49 measurement reliability to understand the convergent validity, the value of each construct's average variance extracted (ave) should be > 0.5 (fornell and larcker 1981). in this research, the average variance extracted of all constructs is > 0.5, confirming the validity of convergence. the composite reliability value of all the constructs must be greater than the value of.60 to understand the composite reliability (cr) (bagozzi and yi 1988). the cr of all constructs is from 0.702 to 0.777, which is > 0.60 thresholds suggested. the cronbach 0.70 alpha value is considered a minimum range to calculate the structural reliability (hair, anderson et al. 2010). also, the alpha values of the cronbach preferably range between 0.7 and 0.90, although the values are small as 0.6 it would be appropriate (nunnally & bernstein 1994). within the final measurement model, we measured and tested the live reliability. for all constructs, the cronbach alpha exceeded the specified limit of 0.60. codes factor loadings smc mean sd α cr ave 21-27 years 104 34.20% 28-34 years 119 39.10% educational level above 40 years below metric 34 13 11.20% 4.30% intermediate 74 24.30% bachelor 127 14.80% how many years you are in sports? master or above 13 years 90 17 29.60% 5.60% 35 years 89 30.95% what sports do you play? above 05 years volleyball 193 86 63.50% 28.30% badminton 66 21.70% football 70 23.00% table tennis 60 19.70% basket ball 22 7.20% at which level you play sports? recreational 45 14.80% domestic 176 57.90% national 81 26.60% international 2 0.70% do you prefer to wear branded sports wear? yes 304 100% no which brand you prefer to use. nike 108 35.5% adidas 77 25.3% puma 56 18.4% asics 11 3.6% reebok 6 2.0% converse 8 2.6% bata 11 3.6% service 26 8.6% other 1 .3% how many years using this brand? 1-2 years 23 7.60% 3-4 years 50 16.40% 5-6 years 125 41.20% above 6 years 106 34.80% 0n how many times do you participate in sports 1-2 times 29 9.50% and physical activity a week? 3-4 times 87 28.60% 5-6 times 188 61.90% how many hours do you practice a day? 1-2 hours 103 33.90% 3-4 hours 139 45.70% south asian review of business and administrative studies vol. 1, no. 1, june 2019 50 brand experience bes1 0.77 0.540 4.05 bes2 0.95 0.765 4.23 bes3 0.73 0.630 3.81 bea4 0.90 0.849 4.30 bea5 0.46 0.370 4.06 0.539 0.811 0.744 0.554 bea6 0.56 0.488 4.00 beb7 0.94 0.786 3.98 beb8 0.92 0.691 4.43 beb9 0.88 0.700 3.80 bei 10 0.80 0.554 4.11 bei 11 0.92 0.765 4.03 bei 12 0.93 0.667 4.05 brand trust bt1 0.40 0.281 4.18 bt2 0.78 0.673 4.31 bt3 0.68 0.463 4.04 bt4 0.92 0.775 4.31 bt5 0.98 0.811 4.12 0.582 0.718 0.777 0.608 brand commitment bc1 0.90 0.671 4.19 bc2 0.91 0.615 4.32 0.629 0.767 0.727 0.529 bc3 0.94 0.647 4.38 bc4 0.88 0.563 4.27 brand loyalty bl1 0.47 0.791 4.27 bl2 0.89 0.780 4.34 bl3 0.80 0.678 4.24 bl4 0.65 0.561 4.24 0.640 0.827 0.702 0.521 bl5 0.73 0,661 4.23 bl6 0.67 0.656 4.27 brand service quality bsq1 0.90 .770 4.26 bsq2 0.97 .350 4.04 bsq3 0.88 .650 3.66 0.788 0.720 0.752 0.566 bsq4 0.54 .554 3.92 bsq5 0.40 0.182 3.96 hypothesis test validated the overall model using sem based on amos covariance. h1: the findings illustrate the important and optimistic relationship between be and bc since the value of st. regression coefficient 0.16 or (µ = 0.16) is less than 0.05. and the findings show that be affects bc substantially and directly.h2: the findings illustrate the important and positive relationship between be and bt due to the st. regression coefficient value 0.19 or (ţ= 0.19) at a p below 0.05. and the results show that be affects bt significantly and explicitly.h3: the findings show the important and optimistic relationship between bc and bl, because the value of st. rectification coefficient 0.23, or (β= 0.23), with p under 0.05 is present. and the findings indicate that bc affects bl greatly and explicitly.h4: the findings show the important and positives relationship between bt and bl as the st. regression co-effective value 0.15 or (α= south asian review of business and administrative studies vol. 1, no. 1, june 2019 51 0.15) with p below 0.05 shows. and the results show bt has a substantial and clear effect on bl. h5. the results show the important and optimistic correlation between bt and bc because of the value of st. regression co-efficient 0.25 (µ=0.25) with p less than 0.05. and the findings indicate that bt affects bc strongly and directly.h6: results indicate the important and optimistic relation between be and bl as a st. regression coefficient 0.15 or p less than 0.05 (µ=0,15) is seen. and the findings show that the effect of be on bl is important and direct.h7: brand commitment mediate the relationship between be and bl at st. regression co-efficient 0.14 or p less than 0.05 (µ=0,14) is seen. h8: brand trust mediate the relationship between be and bl at st. regression co-efficient 0.14 or p less than 0.05 (µ=0,14) is seen. h9: brand service quality positively moderate the relationship between be and bc at st. regression coefficient 0.16 or p less than 0.05 (µ=0,16) is seen. hypothesis structural path (γ) t-values p values decision h1 bc <--be 0.165 2.751 0.006 accepted h2 bt <--be 0.194 3.192 0.001 accepted h3 bl <--bc 0.229 2.857 0.001 accepted h4 bl <--bt 0.154 1.998 0.001 accepted h5 bc <--bt 0.256 3.361 0.001 accepted h6 bl <--be 0.131 2.187 0.001 accepted h7 bl <--bc <--be 0.14 2.004 0.001 partial mediation h8 bt <--be <-- bt 0.14 2.004 0.001 partial mediation h9 bl <--be_x_bsq 0.16 2.18 0.001 positive moderation south asian review of business and administrative studies vol. 1, no. 1, june 2019 52 discussion this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this research aimed to investigate whether brand experience is associated directly with brand loyalty or whether there is an indirect link through trust or brand commitment. the results show that a variety of brand experiences increase the trust of the brand. the finding is intimately linked to the findings of the (forrester survey 1999), whereby 90% of all branded sportswear clients consider that the secret to selecting the favorable branded sportswear to be the positive customer experience. such a move clearly improves consumer trust in branded sportswear. although a large number of branded sportswear aim to improve their brand confidence, only a 1 1.5 2 2.5 3 3.5 4 4.5 5 low be high be b c moderator low bsq high bsq south asian review of business and administrative studies vol. 1, no. 1, june 2019 53 handful have the benefits of leading companies. brand experience for customers appears much more relevant for items like this. this means that managers develop a strong reputation based on positive client interactions. for example, branded sportwear may give people or friends who want to play a role a favorable word of mouth contact. the meaning of brand faith. the results indicate that brand faith has a major effect on brand loyalty. these findings have been supported in previous studies (hollebeek 2011). brand trust helps to foster brand loyalty (hollebeek 2011). since trust creates an exchange between the manufacturer this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). a client who believes in a brand is more likely to remain engaged in the brand, pay higher rates, buy new products in existing and new styles and share some information on the consistency, wishes and actions of the brand (hollebeek 2011). trustworthy labels are most often to be purchased. higher brand faith is aimed at improving brand loyalty. trust is critical in many respects; products markets are of quality and clients are vulnerable to unfavorable selection costs and moral hazards, all costs of the agency. brand trust has a positive influence on brand loyalty. this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). this study shows that brand trust has a positive effect on sportswear engagement from consumer brands. analyzing brand trust's impact on brand engagement this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al., 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). brand trust has a positive influence on brand loyalty. the outcome is the same as (moorman, zaltman et al. 1992). the above study shows that brand faith affects the relationship between brand engagement and brand loyalty. this study shows that brand trust has a positive effect on sportswear engagement from consumer brands. analyzing brand trust's impact on brand engagement was in line with the dedication of trust relationships (morgan and hunt 1994). even with the positive effect of brand trust on brand engagement (hollebeek 2011). our research shows that dedication mediates a suggested relationship between brand experience and brand loyalty. the most important contribution to the analysis. a brand experience deemed superior by shoppers only leads to real loyalty to the brand if a commitment between the brand and its customers has already been formed. this is a recent conclusion that contributes to the advancement of the new brand experience model. an awareness of the mediation impact of branded sportswear faith gives useful insights into literature on brand experience. branded sportswear trust is important before service providers, due to intensive competition and the value of branding (morgan-thomas and veloutsou 2013). more specifically, this research expands prior analysis on the commitment of the consumer brand and on brand experience by presenting analytical proof of the prior explanation of sportswear (nysveen, pedersen et al. 2013). this study shows that the quality of consumer sportswear plays a moderating role in the brand experience, brand love, and brand engagement and brand loyalty linkages. this study does not vary from other analyzes of the models which show service quality as an indicator for consumer humour or behaviour. this proposition is based on the claim by (prentice, wang et al. 2019) that customer-based variables are more representative of the desire of consumers to interact with a brand. service quality represents the cognitive evaluation of the sportswear facilities offered by the brand. in order to be successful, branded sportswear can provide high-quality service from the viewpoint of consumers. there is several alternative sportswear, especially in the sportswear industry, that would take south asian review of business and administrative studies vol. 1, no. 1, june 2019 54 customers to their scheduled visit. managerial implications this analysis will deliver the implications for executives in the sportswear industry above the analytical contributions. this major change from brand welfare to brand experience was also indicated by prior studies on customer experience (barnes, mattsson et al. 2014). also, consumer loyalty, a significant marketing phenomenon, is a major source of competitive benefits for businesses (kandampully, zhang et al. 2015). it can be seen from the empirical findings that, relative to those of the direct effects, the indirect impact of consumer brand experience on brand loyalty via brand trust and brand commitment is greater. this is an important finding of this research, which shows that it is possible for a sportswear to increase the degree of brand commitment and brand trust and build brand loyalty more efficiently by increasing the level of consumer brand experience with an emphasis on developing exclusive sportswear brand experiences. it will subsequently assist managers of sportswear in enhancing market efficiency. in addition, many of the participants in this study visited sportswear brand customers who created three, four or more than four sportswear products. this suggests that the value of sportswear on the definition of consumer brand loyalty is often seen by sportswear clients. these findings therefore have highly significant managerial implications as they indicate that in order to produce loyal customers, businesses need to further focus on the brand loyalty level of their commitment and on their entire brand experience to develop and consolidate their affective relationships with their customers. in this respect, managers need not only seek to maintain cross-functional communication and operations cohesiveness at all points of interaction, as many organizations have increasingly concentrated on. they should also prepare and promote commitment with the wider experience strategically. the results are that the whole company needs brand management to concentrate and that positive experience and customer commitment would be incredibly difficult to create if staff are not also dedicated to and live up to the ideals of the brand. overall, recruiting, preparation and internal communication practices seem to be important concerns if brands are to have superior brand experience which can contribute to high expectations of loyalty to their consumers. limitations similarly, there are certain limitations to this analysis in another research. firstly, this research was performed only in the sense of branded sportswear, which restricts its generalization. the proposed structure should be evaluated in other sectors, such as banking, tourism and telecommunications, etc., to increase the generalizability of 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(2006), “when brand attitudes affect the customer satisfaction-loyalty relation: the moderating role of product involvement”, journal of consumer psychology, vol. 16 no. 2, pp. 145-155.20 south asian review of business and administrative studies vol. 1, no. 1, june 2019 56 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 43 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.1, june 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas brand experience and brand commitment: chartering new directions fareeha tahir, ms scholar, department of management sciences, comsats university islamabad, wah campus, pakistan tahir saeed, head of department, leadership and management studies national defense university, islamabad, pakistan ammara akram, lecturer, department of commerce, b. z. university, pakistan. khawar naheed, assistant professor, department of commerce, b. z. university, pakistan article details abstract history revised format: may 2022 available online: june 2022 keywords brand image, brand experience, brand passion, and brand commitment. the marketplace is gradually becoming more competitive and dynamic nowadays. in this scenario, the ultimate goal for brand managers is to achieve brand commitment. considering the significance of brand commitment, this study explores the impact of brand experience on brand commitment via mediating influence of brand passion in light of the stimulus-organism response model. moreover, this study evaluates the impact of brand image on brand experience and brand passion. the theoretical framework has been analyzed via structural equation modeling using amoss 22.0 by using data from 390 smartphone users. for the data collection, a structured questionnaire was used. the result indicates that brand passion mediates the relationship between brand experience and brand commitment. the existence of this mediation validates the application of the s-o-r model. moreover, this research proves that brand image has a positive linkage with brand passion. lastly, this research depicts that brand image plays the role of the antecedent of brand experience. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: khawarnaheed@bzu.edu.pk doi: https://doi.org/10.52461/sabas.v4i1.1023 introduction the market place nowadays is becoming hyper-competitive due to rapidly changing customers’ needs (varna, varna, bulgaria & dyankov, 2020). in the context of the pandemic crisis, many firms lost their competitive factor by overlooking two major elements i.e. customer knowledge and experience management (mocanu, 2020). these elements resulted in an interesting contradiction for marketers, where consumers are available with ample choices to switch over instead of staying committed to one brand (martillo jeremías & polo peña, 2021). in this scenario, marketers are focusing heavily on building and nurturing consumer-brand relationships (kumar & kaushik, 2020). offerings from different firms pull customers from brand commitment at negligible switching costs (das, agarwal, malhotra, & varshneya, 2019). in this rivalrous and constantly changing marketplace, one of the eventual goals for firms is to develop brand https://journals.iub.edu.pk/index.php/sabas mailto:khawarnaheed@bzu.edu.pk https://doi.org/10.52461/sabas.v4i1 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 44 commitment. literature in this domain has analyzed numerous determinants for brand commitment such as attitude, attachment, love, personality, and identification. the use of brand experience in creating consumer and brand relationships has garnered the attention of numerous scholars in recent years. zha et al. (2020) also argued that there is widespread agreement that the brand experience literature lacks conceptual works. brand experience consists of subjective consumer experiences, emotions, cognitions, or behavioural responses elicited by brand-related stimuli (martillo jeremías & polo peña, 2021). against this background and considering the importance of brand experience, the present research investigates the impact of brand experience on brand commitment through brand passion by applying stimulus organism response (s-o-r) model. moreover, this study also observes the impact of brand image on brand experience as well as on brand passion. the construct of brand experience has been conceptually and empirically validated as an important concept that holds the main part in building brands (kumar & kaushik, 2020; zha et al., 2022) the association among the two constructs i.e. brand experience and brand commitment has remained questionable in intuitive terms, favorable brand experience must portray brand commitment as an outcome. despite the fact, that in literature, there are contradictory opinions about this relationship. marmat (2021) suggested a direct relationship among these constructs. whereas, paik and lee (2021) argued about an indirect relationship between them via mediators representing cognitive and hedonic features. the interest in the concept of passion has flourished in recent years (gilal et al., 2021). brand passion is supposed to be a significant part of this missing linkage, which offered a powerful relational link to brands that individuals value. brand passion seems to be an intense feeling possessed by a customer and directed to the brand (wang et al., 2021). these feelings indicate the inclination of the customer to establish an intimate relationship with the brand and imply a customer’s physiological arousal by possession of that brand. an effective and highly positive attitude for a certain brand that directs the customer towards an emotional attachment and impacts the related behavioral factors is known as brand passion (bauer, heinrich, & martin, 2007). swimberghe, astakhova, and wooldridge (2014) have introduced the approach of dualistic brand passion by translating the work of vallerand et al. (2003) (on dual approach to passion activities) into consumer and brand environment context. there are two different dimensions for brand passion based on a brand’s internalization in an individual’s identity (wang et al., 2021). based on these conceptualizations, this research uses the s-o-r model for testing the proposed relations between brand experience and brand commitment in presence of brand passion i.e. obsessive brand passion (obp) and harmonious brand passion (hbp). the s-o-r model is based upon three elements stimulus, organism, and response. the first element is stimulus, it is an influence that arouses the person (eroglu, machleit, & davis, 2001). the second element is the organism, it conceptualized as the intrinsic processes which intervene in the stimuli and final action (chang, eckman, & yan, 2011). the last element is a response, it is a behavioral outcome of an individual which could be an approach behavior or avoidance behavior (robert & john, 1982; sherman, mathur, & smith, 1997). the present study proposes brand experience as a stimulus that triggers the organism in form of brand passion and this organismic state eventually leads to a response of brand commitment (i.e., a behavioral outcome). antecedents of brand experience were investigated by different scholars including nysveen and pedersen (2014), ghorbanzadeh et al. (2020), and roswinanto and strutton (2014). the present study explores a brand’s image impact on brand experience as an antecedent. literature has shown that this impact needs more clarity and could offer a prospective avenue for upcoming research as south asian review of business and administrative studies vol. 4, no. 1, jun 2022 45 mandated by das et al. (2019). moreover, this study also explores the impact of brand image on brand passion i.e. obp and hbp. previous studies on brand image propose that consumers might designate human qualities to the brands consumed by them, which leads them the love thousands. brand love comprises different components. one of the components of brand love is brand passion. by inferring from this relationship, this study proposes a positive impact of brand image on brand passion (obp and hbp). literature review and hypotheses development stimulus organism response model in this study, the theoretical backbone is the s-o-r model. mehrabian and russell (1974), presented this model. it comprises three main components i.e. stimulus, organism, and response. stimulus is the first component, it is an influence that evokes an individual (eroglu et al., 2001). the second component is organism, that defines as the internal structures or processes which intervene in the external stimuli and emitted responses (chang et al., 2011). it is an emotional response by a customer towards the stimuli (bagozzi, 1986). the response is the final component; it represents the outcome or final decision of the customer. a response could be in form of approach or avoidance behavior. this model states that stimulus affects a customer’s emotions which then influence her behavior in turn. in this research, stimuli are brand experiences of customers that affect the brand’s passion for working as an organism which eventually causes a response in form of brand commitment. brand image and brand experience keller defines brand image as “perceptions of the brand that reflect consumer associations in the mind of the consumer” (keller, 1993, p. 3). the brand image involves brand associations, that are obtained from customers’ memory and perception (anggraeni & rachmanita, 2015). brand image is a phenomenon that is been investigated since the start of the 1950s, but still, it lacks consensus in views about its conceptualization and measurement (iglesias, markovic, singh, & sierra, 2019). brand experience defines as “subjective internal consumer responses (sensations, feelings, and cognitions) and behavioral responses evoked by brand-related stimuli that are part of a brand’s design and identity, packaging, communications and environments” (brakus, schmitt, & zarantonello, 2009, p. 53). as the customers consume the brand, discuss the brand with others, look for information about the brand, through events or promotions, etc. the brand experience is generated (nadzri, musa, muda, & hassan, 2016). brand experience is an experiential construct (singh, bajpai, & kulshreshtha, 2020). it exhibits all the consumers’ experiences relevant to the brand. brand image is considered a customer-based phenomenon (nyadzayo & khajehzadeh, 2016). it helps in understanding the features, functional benefits, and customers’ individual experiences connected to a certain product or service. when there is stability in the image of the brand, it helps the consumers to choose the product with no hesitancy. therefore, marketers are heavily focused on aggressive positioning of brand image in consumers’ minds so the brand’s name remains stored in their minds. a brand image helps the consumer in differentiating the brand from other competitive brands. the strong brand image seems to influence the brand experience. in the past lesser amount of research has explicitly examined the relationship between brand image and brand experience (othman, musa, muda, & mohamed, 2016). das et al. (2019), proposed in their study that brand image should be explored as an antecedent of brand experience. all this evidence from past literature indicates that there could be a possible relationship between the constructs. hence, it is hypothesized that h1: there is a positive impact on brand image and on-brand experience. south asian review of business and administrative studies vol. 4, no. 1, jun 2022 46 2.3 brand image and brand passion according to the literature on branding, brand image defines a summation of whole perceptions (such as emotional and rational) connected by consumers towards particular brands (pourazad et al., 2019). consumers desire to groom themselves so that, they can convey their self-image. consumers are expected to build strong emotional ties with the brands which possess an image compatible with their self-concept of the consumers (aaker, 1997; malhotra, 1988). as a brand’s personification, the brand image exhibits an individual’s self-image. in past, rageh ismail and spinelli (2012) have observed a positive linkage between brand image and brand love. literature on brand image proposes that consumers might allocate human traits to the brands used by them. so, as an emotional outcome, this allocation of human traits to brands lead the customers to love these brand (islam & rahman, 2016; pourazad et al., 2019). a positive brand image is a source of inspiring passion in consumers to love these brands. brand passion is conceived to be the element of brand love (thomson, macinnis, & whan park, 2005). hence present research expands on the potential impact of brand image on brand passion (hbp and obp) and it’s hypothesized, h2a: there is a positive impact of brand image on harmonious brand passion. h2b: there is a positive impact of brand image on obsessive brand passion. brand experience and brand commitment the experience concept comes into sight in several consumer or marketing contexts like customer experience, consumption experience, service experience, online experience of a customer, and finally brand experience (brakus et al., 2009; chandler & lusch, 2015; homburg, jozić, & kuehnl, 2017; jain, aagja, & bagdare, 2017; lanier jr & rader, 2015; lemon & verhoef, 2016; mclean & wilson, 2016). a psychological attachment toward a brand is classified as brand commitment (beatty & kahle, 1988; lastovicka & gardner, 1979). it links with a higher level of brand trust and a positive brand image (chaudhuri & holbrook, 2002; kim, morris, & swait, 2008). in relevance to social exchange theory, mbango (2018) states: that the more often a customer experience a larger return (in term of satisfaction) through their branded products more they are expected to show commitment towards those products. literature provides proof of a direct connection between brand experience and brand commitment. it evokes pleasing outcomes and therefore consumers want to repeat these favorable experiences. customers with positive brand experience are expected to repeat purchases and hardly switch to alternate brands (chaudhuri & holbrook, 2001). perhaps, customers are motivated to give high value to a brand that makes them more committed and loyal to it. a positive brand experience may cause buyers to develop an emotional or cognitive attachment to the brand as well as repeat purchase behaviour (zarantonello & schmitt, 2010). in consumer brand relationships brand commitment is an essential element (chaudhuri & holbrook, 2001). one of the positive outcomes of commitment is the intention of a consumer to repurchase (fullerton, 2005; hur, ahn, & kim, 2011; kim et al., 2008; lacey, 2007; shuv-ami, 2012) defines using repeat patronage. about interpersonal relationship theory, people’s commitment towards their partners is relative to their experiences in the past. keeping in view the similarities between humans and customer brand relationships, it could be claimed that consumers turn out to be more committed to the brands with which they observed positive brand experiences. moreover, when customers consider the brand stimuli pleasing, they want a repetition of these experiences (brakus et al., 2009). consequently, the customer shows a strong commitment to the south asian review of business and administrative studies vol. 4, no. 1, jun 2022 47 brand. therefore, it is assumed that brand experience influences brand commitment positively. so, it is hypothesized that h3: there is a positive impact of brand experience on brand commitment. brand experience and brand passion the brand experience involves “subjective, internal consumer responses (sensations, feelings, and cognitions) and behavioral responses evoked by brand-related stimuli that are part of a brand's design and identity, packaging, communications, and environments” (brakus et al., 2009, p. 53). it comprises primarily of four dimensions, namely emotive, cognitive, sensory, and behavioural. brand experience’s affective dimension represents emotions. the intellectual dimension communicates the competence of a brand to inspire analytical and imaginative thoughts. the sensory dimension is about the aesthetic and sensory abilities which are attractive to the senses. lastly, the behavioral dimension is about actions and bodily experiences associated with the brand (nysveen, pedersen, & skard, 2013). brand experience is the bunch of responses evoked in customers at each touchpoint along with the brands (alloza, 2008; klein, falk, esch, & gloukhovtsev, 2016). four forms of responses are there is a brand experience sensory, intellectual, affective, and behavioral (kang, manthiou, sumarjan, & tang, 2017). research in the area of brand experience has thrived from the start of the 2000s, it was an inborn result of an experiential focus on market and research in areas of consumer behavior and marketing (andreini, pedeliento, zarantonello, & solerio, 2019). brand passion defines as “a strong emotional connection to a brand that people value, find important, desire to own and/or use, incorporate into their identity, and invest resources in over some time” (swimberghe et al., 2014, p. 2659). according to identity theory, an individual’s selfbrands are essential in the way that people consume brands to socially exhibit their identity. the goal of the sensory brand experience is to entice consumers by appealing to the stimulation dimension of the self through the induction of sensory pleasure. the behavioural experiences of a brand try to attract consumers by appealing to the self-efficacy dimension. intellectual brand experiences strive to captivate consumers by appealing to the symbolic meaning dimension of the self, allowing them to transmit a superior self and social identity. hence, brand experiences aroused by stimuli (associated with the brand) can affect different dimensions of self-identity and by that means fulfilling the several needs of consumers. park et al. (2013), described the connection between consumers and brands in the light of attachment aversion theory. the consumers feel more connected to the brand as the distance between self and perceived brand is closer and when the thoughts related to the brand are more influential. as an outcome of this connection, a strong and tempting desire for the brand is generated this led the consumers to have an emotional attachment in form of brand passion. brands’ autonomous internalization of an individual’s identity results in hbp. however, a brand’s controlled internalization of an individual’s identity results in obsessive brand passion. in the context of the s-o-r model, the present research postulates that brand experience is a stimulus that influences the internal organismic state of consumers in form of brand passion. hence we hypothesized that, h4a: there is a positive impact of brand experience on harmonious brand passion, and h4b: there is a positive impact of brand experience on obsessive brand passion. brand passion and brand commitment according to the literature available on branding, brand passion is defined as “a strong emotional connection to a brand that people value, find important, desire to own and/or use, incorporate into their identity, and invest resources over some time” (swimberghe et al., 2014, p. 2659). brand south asian review of business and administrative studies vol. 4, no. 1, jun 2022 48 passion arouses intense emotions that describe the customer and brand relationship, it encourages the consumers to invest resources, establish an intimate bond along with the brand, and stay around for a longer run. in a variety of scenarios, the brand's harmonious passion provides an internal drive that encourages consumers to preserve their relationship with the brand in harmony with their other life aspects (albert et al., 2013). moreover, in obsessive brand passion cases, consumers might anticipate suffering when they could not be with their desired brand. hence, they stay committed to that particular brand. therefore, in light of the s-o-r model and the abovementioned reasoning, the present study postulates that brand passion acts as an organism that eventually leads to the behavioral response by consumers in form of brand commitment. hence, this study hypothesizes that, h5a: there is a positive impact of harmonious brand passion on brand commitment. h5b: there is a positive impact of obsessive brand passion on brand commitment. brand passion as mediator between brand experience and brand commitment mehrabian and russell (1974), presented the s-o-r model. the first component of this model is stimulus, it defines as an influence that evokes an individual (eroglu et al., 2001). the second component is the organism, it is an emotional response by the customer towards the stimuli (bagozzi, 1986). it defines as the internal structures or processes which intervene between the external stimuli and emitted responses (chang et al., 2011). the third and final component is the response, it represents the outcome or final decision of the customer (bagozzi, 1986). the response could be in form of approach or avoidance behavior (bagozzi, 1986). in the context of the s-o-r model, the present study proposes that brand experience acts as a stimulus that triggers an organism in form of brand passion and this organismic state eventually leads to a behavioral response by the consumer in form of brand commitment. hence, this study hypothesizes that h6a: harmonious brand passion mediates between brand experience on brand commitment and h6b: obsessive brand passion mediates between brand experience on brand commitment. figure1 research model methodology sampling and data collection the present study used a non-probability sampling method. the data collection was made from smartphone users. for data collection, respondents were personally contacted as well as an online link to the questionnaire was also provided. firstly, respondents have written the name of south asian review of business and administrative studies vol. 4, no. 1, jun 2022 49 smartphone brand name in their use on the questionnaire. after that, the survey questionnaire was presented to them. the calculated sample size by using the formula is 400. a total of 450 questionnaires were distributed from which 410 were received back. after data cleaning the data 390 were used in further analysis. measures this study follows the five-point likert scale. wherein, the scale falls within the bracket of 1 to 5. 1 symbolizes strongly agree and 5 symbolizes strongly disagree. already tested items have been adopted from previous literature to measure each construct. in this study, brand image is measured by an adopted scale by martínez and de chernatony (2004). it is measured by using 6 items. brand experience is measured through an adopted scale by brakus et al. (2009) by using 12 items. brand passion is measured via the adopted scale of vallerand et al. (2003) by using 12 items. brand commitment is measured via the adopted scale of shukla et al. (2016) by using 11 items. analysis and results the assumptions of normality for multivariate analysis are fulfilled by using the results of correlation, skewness kurtosis, and q-q plots table 1 data normality statistics (n=390) constructs min max skewness se kurtosis se tolerance vif bi 10.00 25.00 -0.40 0.12 -0.31 0.24 0.69 1.44 be 5.00 25.00 0.02 0.12 -0.34 0.24 0.61 1.62 hbp 7.00 30.00 -0.30 0.12 -0.31 0.24 0.55 1.80 obp 6.00 30.00 0.15 0.12 -0.87 0.24 0.64 1.54 bc 10.00 50.00 -0.00 0.12 -0.43 0.24 dependent variable notes: bi=brand image; be= brand experience: hbp= harmonious brand passion; obp= obsessive brand passion; bc= brand commitment; se=standard error; vif=variance inflationary factor descriptive of demographics the data from 390 smartphone users were collected. in terms of gender, 60.5% were female and 39.2 % were male. in terms of education, 15.4 % of the respondents have high school certification, 64.9 % of respondents have bachelor’s degree, 17.7 % of the respondents have master’s degrees and 2.1% were others. in terms of occupation, 75.1 % were students, 6.7 % were self-employed, 16.4 % were professional and 1.5 % of respondents were others. in terms of smartphone brand, 29.6% of respondents own samsung, 25.6% of respondents own huawei, 13.1% of respondents have iphone, 10.8% of respondents own oppo, 3.6% of respondents have nokia, 1.8% of respondents have xiaomi, and remaining 15.4% own other brands. reliability and unidimensionality the validation of the items of each latent variable was checked for unidimensionality. individual confirmatory factor analysis (cfa) was done using amos 22.0. few items were deleted after an initial run of individual cfa because of lower factor loadings like for brand image item bi 5, for brand experience items number be1, be 2, be 3, be 5, be 7, be 9 and be 11 were deleted. in the case of brand commitment item number, bc 1 was deleted due to lower factor loading. the second run of cfa confirmed the significant loading of items into their latent variables. in this run of cfa few error terms were correlated to get more accurate fit indices like in the case of brand image ℮1↔℮5 and ℮2↔℮5 were correlated, for hbp ℮2↔℮4 and ℮3↔℮4, for obp ℮4↔℮5, ℮1↔℮6, ℮2↔℮4, ℮5↔℮6, ℮4↔℮6 and in case of brand commitment ℮1↔℮2 were south asian review of business and administrative studies vol. 4, no. 1, jun 2022 50 correlated to get the accurate fit indices. cronbach’s alfa scores in table 1 show that values are ≥ 0.7, which confirms that the items are error-free. the normal fit index (nfi) also showed acceptable values ≥ 0.90. the results of this process indicated that the data was overall fit to move further for five factors nested cfa. table 2 results of individual cfa (n=390) constructs items unidimensionality convergent validity reliability χ2/df gfi cfi rmr rmsea nfi fl (min-max) α bi 5 1.48 0.99 0.99 0.02 0.03 0.98 0.50-0.72 0.72 be 5 2.50 0.98 0.97 0.04 0.06 0.95 0.50-0.65 0.70 hbp 6 2.30 0.98 0.97 0.04 0.06 0.96 0.53-0.67 0.80 obp 6 2.51 0.98 0.99 0.03 0.05 0.98 0.69-0.87 0.90 bc 10 2.49 0.96 0.97 0.05 0.06 0.95 0.52-0.78 0.89 notes: bi=brand image; be= brand experience: hbp= harmonious brand passion; obp=obsessive brand passion; bc= brand commitment; gfi= goodness of fit index; cfi= comparative fit index; rmr= root mean square residual; rmsea= root mean square error approximation; nfi= normed fit; fl= factor loadings; α = cronbach’s alpha the overall nested model shows the acceptable model fit indices. table 2 also shows that all factor loadings are greater than 0.50, which supports the convergent validity. table -3 five factors nested cfa (n=390) unidimensionality convergent validity reliability indicators χ2/df gfi cfi rmr rmsea nfi fl [min-max] α 32 1.94 0.90 0.92 0.05 0.05 0.91 [0.54-0.78] 0.93 notes: χ2= chi square; df= degree of freedom; nfi= normal fit index; cfi= comparative fit index; rmr= root mean square residual; rmsea= root mean square error of approximation; fl= factor loadings; α = cronbach’s alpha. convergent validity has been explained by bagozzi and phillips (1982) as the level of agreement of results if the same construct is measured multiple times. the nfi was calculated to fulfill the first method of finding a model fit. table 3 shows the nfi value of 0.91 and the second method recommends that estimates of factor loadings should be ≥ 0.5. table 3 shows that all factor loadings are greater than 0.50, which supports the convergent validity. fornell and larcker (1981) recommended analyzing the discriminant validity which is the square root of average variance extracted (ave) values. if this square root is larger in comparison to the correlation coefficient value of the individual constructs, the model is fit to run a path analysis for testing the hypotheses. table 4 shows the reliability of the results as the values of correlation is smaller than the square roots values of aves in the diagonal. table 4 discriminant validity (covariance among latent variables) (n=390) constructs bi be hbp obp bc mean sd bi 0.59† 0.35** 0.53** 0.23** 0.28** 19.40 3.53 be 0.6† 0.49** 0.54** 0.54** 15.47 3.81 hbp 0.57† 0.47** 0.51** 21.08 4.68 obp 0.75† 0.72** 16.08 6.52 bc 0.76† 30.21 8.86 south asian review of business and administrative studies vol. 4, no. 1, jun 2022 51 notes: bi=brand image; be= brand experience: hbp= harmonious brand passion; obp=obsessive brand passion; bc= brand commitment; ** correlation is significant at 0.01 level (2-tailed; †√(ave) values in the diagonal hypotheses testing to provide empirical relationships between variables sem model is estimated. the direct effect and indirect effect structural models have been fitted to evaluate the hypotheses. to estimate the fit of both structural models, numbers of indices i.e. goodness of fit indices are used as recommended by the literature on structural equation modeling (sem) e.g. (sila & ebrahimpour, 2005) such as χ2 / df; gfi, nfi, cfi, and rmsea. figur2 direct and indirect effect models in the direct-effect model, we connected the direct path from bi to be, bi to hbp, bi to obp, and be to bc. in this model, no path stems from be to hbp and from be to obp (mediator variables). in an indirect model, we linked the path between be and hbp and be to obp, this procedure to test mediation was based on guidelines provided by shrout and bolger (2002) for testing mediation in sem. the direct effect model (without the path from be to hbp and be to obp) was compared to the indirect effect model (with the path from be to hbp and be to obp). the fit indices for the direct effect model are χ2 = 1098.11, df = 454, χ2 / df =2.41, gfi= 0.85, nfi= 0.83, cfi= 0.89 and rmsea= 0.05. indirect effect model that incorporates path be to hbp and be to obp (mediating variables) demonstrated fit indices i.e. χ2 = 900.44, df = 452, χ2 / df = 1.99, gfi= 0.90, nfi= 0.93, cfi= 0.92 and rmsea = 0.05 and indicating an improvement in fit indices over the direct effect model. the indirect impact model established unambiguously the function of hbp and obp (mediating variables) in elucidating the hypothesised correlations. table 5 results of structural equation analysis for two competing models the relationships between variables direct effect model indirect effect model β s.e β s.e h1: bi→ be 0.60*** 0.07 significant h2a: bi→ hbp 0.76*** 0.10 significant h2b: bi→ obp 0.43*** 0.11 significant h3: be→ bc 0.19*** 0.08 significant h4a: be→ hbp 0.58*** 0.15 significant h4b: be→ obp 0.77*** 0.27 significant south asian review of business and administrative studies vol. 4, no. 1, jun 2022 52 h5a: hbp→ bc 0.21*** 0.05 significant h5b: obp→ bc 0.64*** 0.04 significant h6a: be→ hbp → bc h6b: be→ obp → bc χ2 1098.11 900.44 df 454 452 χ2 / df ratio 2.41 1.99 gfi 0.85 0.90 nfi 0.83 0.93 cfi 0.89 0.92 rsmea 0.05 0.05 r² (be) 0.36 0.16 r² (obp) 0.19 0.55 r² (hbp) 0.58 0.68 r² (bc) 0.69 0.72 notes: bi=brand image; be= brand experience: hbp= harmonious brand passion; obp=obsessive brand passion; bc= brand commitment; χ2= chi square; df= degree of freedom; χ2/df= chi-square ratio; nfi= normal fit index; cfi= comparative fit index; rmsea= root mean square error of approximation; ***p < 0.001; * *p < 0.05 h1 states that bi positively impacts the be. results from table 5 reveal that bi has a positive influence on be (h1: β = 0.60, p < 0.001) hence h1 is accepted. h2a states that bi and hbp are positively related. results from table 5 validates that bi positively impacts hbp (h2a: β = 0.76, p < 0.001) so, h2a is accepted. h2b states that bi and obp are positively related. results in table 5 validates the positive relationship among bi and obp (h2b: β = 0.43, p < 0.001), consequently h2b is also accepted. h3 states that be and bc are positively related. results from table 5 confirm the positive relationship between be and bc (h3: β = 0.19, p < 0.001), so h3 is accepted. h4a states that be positively influences hbp. the results of table 5 verify the positive influence of be on hbp (h4a: β = 0.58, p < 0.001), hence h4a is accepted. h4b stated that be positively influences obp. results also verifies the positive influence of be on obp (h4b: β = 0.77, p < 0.001). hence h4b is accepted. h5a states that hbp impacts bc positively. results confirms the positive impact of hbp on bc (h5a: β = 0.21, p < 0.001), consequently h5a is accepted. h5b states that obp impacts bc positively. results also confirms the positive impact of obp on bc (h5a: β = 0.64, p < 0.001), so h5b is accepted. h6a and h6b with regards to the mediating role of hbp and obp; state that hbp and obp significantly mediate the relationship between be and bc. results in table 5 demonstrate an improvement in indices in the indirect effect model in comparison to the direct effect model. the indirect impact model identified the function of hbp and obp (mediating variables) in elucidating the postulated associations. hence, based on the results both h6a and h6b are accepted. discussion and conclusion using the s-o-r model, the current study aimed to examine the effect of brand experience on brand commitment as mediated by brand passion (split into hbp and obp). moreover, it was intended to study the effect of brand image on experience and brand passion (when divided into hbp and obp). the findings of the study suggest that brand passion mediates the impact of brand experience on brand commitment, the result is consistent with the study by wang et al. (2021) and chen and qasim (2021). the existence of this mediation justifies the s-o-r model's applicability to the relationship between brand experience and brand commitment via the mediating influence of brand passion. the brand image has a beneficial influence on brand experience and brand loyalty. in addition, research indicate that brand image is a precursor to brand experience. the south asian review of business and administrative studies vol. 4, no. 1, jun 2022 53 study's findings provided persuasive conclusions on brand image, brand experience, brand passion (hbp and obp), and brand loyalty. according to the findings, brand image has a direct, positive effect on brand experience. this conclusion aligns with the research conducted by nadzri et al. (2016) and othman et al. (2016). the acceptance of this relationship answers the first research question of this study that brand image influences brand experience. this finding suggests that a strong and positive brand image positively impacts the customer’s brand experience. the result portrays a positive connection between brand image and hbp. moreover, the result of h2b portrays a positive connection between brand image and obp. the acceptance of h2a and h2b suggests that a positive brand image triggers brand passion among customers. this finding suggests that brand image is a potential source of inducing passion among consumers. the result of h3 shows a positive association between brand experience and brand commitment. the finding of this hypothesis is consistent with the study of ramaseshan and alisha stein (2014) depict that a positive brand experience makes the customer committed to the brand. by moving on, the result of h4a shows a positive linkage between brand experience and hbp. the result of h4b portrays a positive linkage between brand experience and obp. overall, the findings depict that a positive brand experience generates brand passion (obp and hbp) among the consumers, it proves that brand experience is a stimulus that influences the consumers’ emotions positively and generates brand passion (organism) in them. the result of h4a and h4b is consistent with the study of das et al. (2019). the result of h5a represents a positive relationship between hbp and brand commitment. the result of h5b shows a positive linkage between obp and brand commitment. overall, the result of both the hypotheses is consistent with the study of das et al. (2019) and indicates that brand passion acts as an organism that leads toward the behavioral outcome of brand commitment. the existence of mediation validates the application of the sor model on the association between brand experience and brand commitment through brand passion. it depicts that brand passion is acting as the organism that intervenes in the effect of brand experience (stimulus) on brand commitment (response). theoretical and managerial implications this research work offers some findings which are significant contributions to the literature on marketing. first of all, it validates the application of the s-o-r model on the connection between brand experience and brand commitment via brand passion. this model states that stimulus affects a customer’s emotions which then influence her behavior in turn. in the s-o-r model by mehrabian and russell (1974) brand passion being the organism mediates the relation between the brand experience (acting as stimulus) and brand commitment (the behavioral response). moreover, this study proves a positive link between brand image, and brand experience and through which it proves that brand image is an antecedent of brand experience. this study fills the literature gap by proving a positive relationship between brand image and brand passion, previously this relationship was vague in the literature. nowadays managers are hugely concerned about how to convert consumers’ experience of a brand into brand commitment. the findings of this study highlight the solution for that, these findings suggest that brand experience is a key predictor of brand passion, which eventually directs towards brand commitment. brand passion when split into two halves it behaves differently. brand’s autonomous internalization in an individual’s identity results in hbp. in hbp people use and purchase the brand without any social or external pressure and they are not compelled to use it. this motivation (internal) to follow the brand allows people to hold a relationship with a brand that is in harmony with additional activities in life. whereas, the brand’s controlled internalization of an individual’s identity results in obp. controlled internalization happens when people find the brand important, like it, and possess a south asian review of business and administrative studies vol. 4, no. 1, jun 2022 54 desire to get or use it or invest in it due to social and internal pressures. however, the findings of this research validate that both types of brand passion obp and hbp lead the consumer towards strong brand commitment. this study provides positive linkages between brand image and brand experience. this positive linkage guides the practitioners about the importance of strong brand image development. it highlights how consumers in this competitive environment opt for a brand with a strong brand image in comparison to other brands with a weak brand image. moreover, this study also proves a positive relationship between brand image and brand passion and it indicates that a positive brand image is a source of inspiring passion in the consumers. so again managers should focus on strategies for building a strong brand image. this research highlights the importance of brand image for practitioners on which they are not focusing. developing a positive brand image can help the brand managers in generating brand love as a brand image is a source of inspiring passion among consumers which can lead them to love that brand. furthermore, the findings of the study show that brand passion mediates the relation between brand experience and brand commitment. so managers should focus on developing and enhancing brand passion by designing some passion-oriented strategies and making a strong emotional bond with consumers. managers can also allure the consumers to be a part of the brand’s social media and offline brand communities to maintain a long-term bond with their customers. as brand passion is an appealing desire, managers can use consumers’ feelings of distress, anxiety, and anticipated separation, particularly in the case of consumers with obp. but it brings up the debate of whether it is ethical or not. moreover, this mediation also suggests that practitioners should distinguish the consumers by the type of brand passion they hold for the brand. it will help them in developing different strategies for consumers with different types of brand passion such as obp and hbp. lastly, findings also portray a positive direct link between brand experience and brand commitment. so managers should also wisely allocate some resources to build brand experience along with brand passion. directions for future research future studies must address the limitations of this study. in the future researchers should opt for a longitudinal research setting, it will help them in getting more precise (cause and effect) results. apart from the smartphone brands industry, other industries should be investigated so that this research could be generalizable to other fields as well. this research explores the influence of only brand image on brand experience as an antecedent, in the future various other antecedents should also be explored. in the future, researchers can replicate this study by collecting samples from only female or only male respondents, considering feminine and masculine smartphone brands this will help in assessing the results of the study in gender-specific settings. future researchers can also choose a certain age group to replicate this study. in the future, more research is needed to recognize the antecedents and consequences of two types of brand passion i.e. obp and hbp. conclusion this research was executed to explore the role of the s-o-r model in exploring the impact of brand experience on brand commitment via mediating effect of brand passion. moreover, this research is also meant to examine the impact of brand image on brand experience (as its antecedent) and brand passion. the problem marketers are facing nowadays is that customers are available with ample choices to switch to other brands instead of staying committed to one brand. the present study provides a solution to this problem. from the findings of this study, it can be concluded that consumers’ positive brand experience can massively help the marketers as it triggers brand passion which directs the behavioral response of brand commitment. the existence of mediation validates the application of the s-o-r model as brand experience acts as a “stimulus” that evokes the customer’s emotions and generates brand passion in them. brand passion here acts as an “organism” which in turn causes a “response” in the form of brand commitment. the outcomes of south asian review of business and administrative studies vol. 4, no. 1, jun 2022 55 this research also highlight the existence of a positive relationship between brand image and brand experience and brand image and brand passion. the acceptance of these relationships highlights the importance of a strong positive brand image. it guides the practitioners to develop a strong brand image by making strategies and investing resources. the study concludes that a strong brand image can lead to a positive brand experience and can also generate brand passion. this finding is a significant contribution for managers because brand passion and positive brand experience both lead the consumer towards brand commitment. by following this path practitioners can also get rid of the problem associated with customer retention. references aaker, j. l. 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(2022). making sense of sensory brand experience: constructing an integrative framework for future research. international journal of management reviews, 24(1), 130–167. https://doi.org/10.1111/ijmr.12270 south asian review of business and administrative studies vol. 2, no. 1, june 2020 65 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas how does managerial ability cherish dividend payout decisions during economic policy uncertainty? bushra sarwar, ghulam ishaq khan of engineering science and technology, pakistan marria hassan, universiti utara, malaysia rehana naheed, lahore leads university, pakistan article details abstract history revised format: may 2020 available online: june 2020 keywords dividend payout epu, economic policy dividend decisions are the road map of investment and hence, carry huge weightage for investors. during periods of economic policy uncertainty dividend cut is devastating and brutal. as previously suggested that epu leads to decreased or no dividends offered by the firms. current study established the argument that relationship between epu and dividend payout changes through moderating role of managerial ability. it was hypothesized that a capable and challenging manager fights epu disasters through his skills, ability to forecast and efficiency and builds a sustained relationship between epu and dividend payout. an extensive data set from 2006-2015 was taken from 1,153 non-financial listed firms of china. results supported the hypothesis robustly. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: bushra-sarwar@hotmail.com doi: https://doi.org/10.52461/sabas.v2i1.430 introduction how firms adjust their corporate policies for economic uncertainty is a long-debated issue in finance literature. the impact of economic policy uncertainty on corporate dividend policy has attained significant importance in last decade after the occurrence of the global financial crisis of 2008 (attig et al., 2018; buchanan et al., 2017; brogaard, & detzel, 2015; chay, & suh, 2009). a firm faces substantial uncertainty about its future paybacks and has concerns about how much these get affected by economic policy uncertainties and how that impact can be marginalized. these uncertainties arise due to policy shocks, for instance, political or institutional decisions, regulatory reforms, firms’ environment changes, etc. economic conditions are pivotal for the survival of firms due to high cost of reversal of corporate policies, for instance, the decision of initiating the dividends or termination of dividends, hiring the talented managers (buchanan et al., 2017; brav et al., 2005; boyle & guthrie, 2003). therefore, firms when design any corporate policy consider the macroeconomic conditions and make sure that their future uncertainty should be minimum. classical view in finance literature states that paying dividend regularly remains consistent over time and it’s quite rare that stock markets push firms to cut the regular dividend payment https://journals.iub.edu.pk/index.php/sabas mailto:bushra-sarwar@hotmail.com https://doi.org/10.52461/sabas.v2i1.430 south asian review of business and administrative studies vol. 2, no. 1, june 2020 66 (buchanan et al., 2017; brav et al., 2005; deangelo, 1991; healy & palepu, 1988). contrast to this empirical stance, based on signaling theory, firms when initiating the regular dividend payment, send a strong signal to their investors specifically and market generally that they intend to maintain a specific level of dividend payment in future as well (buchanan et al., 2017). firms keep paying dividends regularly before the introduction of economic reforms, such as dividend tax, tariff, regulations, etc. in the country (hanlon & hoopes, 2014; korkeamaki et al., 2010). these studies of hanlon & hoopes, (2014) and korkeamaki et al., (2010) indicate that those firms that initiate regular dividend payment are affected more from economic reforms and face more risk potentially to reverse their long-term future dividend policy. hence, firms look for alternatives to cope with such uncertainty and ensure their smooth and strong investor relations. brav et al., (2005) identify that economic and regulatory settings, cash holdings, and profits are considered to be the key factors which determine firms’ dividend policy. huang et al., (2015) demonstrate that political risk affects the dividend payout policy negatively. attig et al., (2016) and bliss et al., (2015) indicate that the global financial crisis of 2008 negatively impacts the firms’ dividend payout. buchanan et al., (2017) find the negative effect of tax policy uncertainty in the us on corporate dividend policy payout. therefore, economic policy uncertainty remains an important aspect for firms to consider while deciding on their corporate dividend policy. firms try to overcome this shortcoming and mainly depend on their management that how effectively it copes such uncertainties. managers can help firms to reduce the speculative risk and communicate effectively with key stakeholders about the volatility arise in dividend policy (herzig & jimmieson, 2006). floyd & lane, (2000) argue that managers have various secondary roles that mainly depend on their abilities, skills, and expertise. their abilities and expertise influence their cognitive biases and decision-making which ultimately impact the firms’ dividend policy (brown et al., 2000; baker et al., 1985). therefore, the managerial ability can play a significant role in reducing the effect of economic policy uncertainty on the firm’s dividend payout and can help firms effectively in deciding whether to initiate or terminate the dividend payments. our study is inspired by many empirical stances. first, economic policy uncertainty influences the overall economic and financial participant in an economy and significantly affects their earnings and future growth prospects. it can weaken an economy’s growth and in return affect the ability of an economy to recover from a policy and regulatory shock (baker et al., 2016). because economic policy uncertainty negatively affects the economic agents so in return, they reduce their investment, spending, and lending. it also halts firms’ capital inflows and outflows, slowing down their business-cycles, and reducing their investment opportunities (bonaime et al., 2018). therefore, the economic policy uncertainty affects firms’ current as well as future earnings and ultimately their dividend policies. second, the paucity of research related to the impact of managerial ability on the dividend under economic policy uncertainty motivates us to conduct this research. existing literature mainly focuses on explaining the impact of managerial ability on dividend payout, but role of managers during economic policy uncertainty is overlooked. economic policy uncertainty can arise due to political, financial, and regulatory shocks which are beyond the control of managers, hence, it is difficult to hedge against epu. so, firms depend on their managers’ ability to adjust their dividend payout policy and lower the effect of epu. therefore, it is interesting to investigate the impact of managerial ability on dividend when there exists economic policy uncertainty. the lack of research may be due to challenges related to measuring the economic policy uncertainty and managerial ability (gulen & ion, 2015; demerjian et al., 2012; hayes & schaefer, 1999). this study bridges this literature gap by using extensive indices to measure economic policy uncertainty (baker et al., 2016) and managerial ability (demerjian et al., 2012) in case of an emerging country china. based on the signaling theory, agency theory, and the upper echelons south asian review of business and administrative studies vol. 2, no. 1, june 2020 67 theory, this study argues that economic policy uncertainty significantly affects the dividend policy. the study finds the significant moderating role of managers in initiating and terminating the dividends during the economic policy uncertainty period by considering the previous status of firms in terms of previously paying or non-paying the dividends. study further analyze the moderating role of managerial ability on dividend policy by segregating sample firms based on owner and professional ceos, and the finding confirms that professional ceos are more pronounced in moderating managerial role on dividend policy during epu. this paper extends the existing literature by making contribution in following ways: first, this study examines the moderating effect of managerial ability on corporate dividend policy when there exists economic policy uncertainty by using indices exclusively to measure epu and managerial ability. second, this study makes methodological contribution by examining this relationship by segregating the data based on firms having professional ceos and owner ceos and examines the relationship. third, the focus of this study on emerging economy and it also conducts instrumental variable analysis to control the endogeneity issue. literature review into the soft spots of dividend puzzle arrows have been thrown since long. progressive research in the area had wide opened cracks in the built theories of dividends. one untold truth is about dividend behavior of the firms at the time of uncertainties, specifically economic policy uncertainty (attig et al., 2018). firms decide to pay dividend to make shareholders happy and on the basis of funds and income that could ahead be generated (chintrakarn, 2018). now discussing dividend decision at the time of economic policy uncertainty literature is evident that an increased risk exposes firms to increased cost of capital (bradley et al., 2016). policy uncertainty can affect cash flows financing and investment decision (park & song, 2019). policy uncertainty has also been reported to effect investor perceptions about expected payoffs from this firm that is highly risky and hence, investor ask for higher compensation for additional risk (julio et al., 2012). reason behind payment of dividend includes existing shareholder’s satisfaction and attraction of more equity capital from the market publicizing image of an earning firm (easterbrook, 1984; jensen, 1986; rozeff, 1982). if firm pays dividends and sustain it even in the time of uncertainty posits signal of positive future prospects as proposed by signaling theory (bhattacharya, 1979; miller & rock, 1985). now coming towards the other side of the game, we see currently an economically challenged world around us. sustaining business with positive image seems to be very enigmatic (aras, 2010) specifically at the time of uncertainty (huang et al., 2015). hence, literature suggests a negative relationship between uncertainty and dividends, but surprising results occur when current study empirically exploited moderation effect of managerial ability on the relationship between epu and dividend decision. managerial ability has in the past been reported as a magnifying factor towards dividend policy of a firm (bertrand et al., 2003; sarwar et al., 2019). strong support to the argument is provided by the famous upper echelon theory (mason & hambrick, 1984). in accordance with uet, firm’s important strategic decisions are made by top management based on several factors such as; environment, culture, institutions, competition. whereas, firm’s strategic choices are highly influencing by the experience, intellect, background, status, ability and personality of a manager (bertrand & schoar, 2003; mason & hambrick, 1984). literature identifies various characteristics of mangers such as their ability, professional attitude, ownership with in the firm significantly affect the firm dividend policy (jiraporn et al., 2016; park & song, 2019). although two paradigms of decision-making policy exist including manager-firm and environment-specific but huge literature in the past has focused on the latter two of that group and remained silent of the former one most of the time. current study found it an important fact to south asian review of business and administrative studies vol. 2, no. 1, june 2020 68 unravel and hence took managerial ability as a moderator to explore how a firm dividend decision gets designed in the presence of higher managerial ability when economic policy uncertainty exists. since long, few researchers have identified the role of a manager in dividend policy and designing a dividend decision (jiraporn et al, 2016). besides clues provided by upper echelon theory researchers attention toward the concept application into dividend decision was abrasive. authors pointed out the fact and hypothesized that a moderation played by managerial ability can turn the table and give unique results. epu and dividend decision: current study attempts to explore the impact of epu on dividend decision with paths of the decision as dividend initiation and dividend termination. attig et al, (2018) found a positive relation between epu and dividends calculated through dividend payout ratios, log of real cash dividends, dividend yield, and the total payout ratio. those findings were strongly counter to previous findings of bliss et al. (2015) and attig et al. (2016) stating that the 2008–2009 financial crisis were related with increased level of uncertainty, decreased dividend payouts by the firms, on the contrary during the post-crisis period and high epu, firms initiated higher dividend payouts and reduced cash holdings (floyd et al., 2015). stressing through agencytheoretic aperture, however, a positive relationship between epu and dividends is suggested. paying dividends to the investor can bring managers towards a long-term binding to disgorge the free cash flows of future and exposing them into monitoring by market, reducing agency costs related to free cash flow, and managers are encouraged to make dividend payments to use financial resources more effectively (e.g., easterbrook, 1984; jensen, 1986; rozeff, 1982). study of some asian and european companies, faccio et al. (2001) found that firms susceptible to expropriation (highly bonded to some business group and low ownership-to-control ratio) might pay significantly high dividend. keeping in mind that agency costs are much pronounced in times of crisis (e.g., bae et al., 2012; lins et al., 2013; mitton, 2002), monitoring advantages of dividends are hopefully going to be more distinct under higher uncertainty. economic policy is a key channel that causes uncertainty and affects financial markets. capital market risk perception increases during period of uncertainties associated with the possible changes in economic or government policies in macro environment (see, e.g., pastor& veronesi, 2013). during period of high uncertainty, an increase in the mangers perceived risk affect the dividend sustainability that cause an increase in external investors risk perception. this leads to an increase in firms’ cost of equity capital. pecking order theory predicts a positive relationship between information asymmetry and cost of external financing (myers & majluf, 1984). if information asymmetry is time–varying, and became severe during high uncertainty period then it leads to an increase in cost of external equity. huang et al., (2015) anticipated an increase in cost of external equity during period of high uncertainties and it makes firm reluctant to pay dividend or to distribute cash. therefore, increase in uncertainty is attributed to changes in economic policies which cause an increase in mangers perceived risk. it leads to an increase in investors’ required rate of return (cost of external equity capital) during period of high policy uncertainty which yield our first hypothesis on the impact of policy uncertainty on payout policy payout. building argument to support this hypothesis, this study implies that usually firms will tend to hinder or refuse to pay any dividends in crisis period specifically at the time of epu. h1: epu has a direct and negative relationship with dividend decision. moderating role of managerial ability between epu and dividends: tracing back to excellent work by miller and modigliani (1961) about dividend irrelevance, scholars have applied empirically into that model many elements of market imperfections, including information asymmetry in stock markets (miller and rock 1985; allen et al., 2000; deangelo et al., 2006), agency conflicts (easterwood 1984; kalay 1982; jiraporn and ning 2006; jiraporn, kim, and kim south asian review of business and administrative studies vol. 2, no. 1, june 2020 69 2011; michaely and roberts 2011), taxes (michaely and vila 1996; hietala 1990; rantapuska 2008) and behavioral biases (shefrin and statman 1984; baker and wurgler 2004). current study brings its contribution into literature by exploring a novel market imperfection that has not been considered in this framework before, that is, managerial ability to get tested as a moderator with epu and dividend decision. in the time of economic policy uncertainty (epu) severity of concern becomes crueler due to a retard performance by all important economic agents (baker et al., 2016). at that time a manager has to decide in presence of both scarcity and risk about dividend (guan et al., 2018). demerjian et al., (2013) explained managerial ability as having strengthening knowledge along more sensitivity towards the environment. managerial ability in the past has been linked with higher ability to judge and make precise forecasting for the firm (baik et al., 2011) and proportional will be their earning quality (demerjian et al., 2012). keeping this in view, the study proposes that managerial ability can be a positive moderator towards dividend decision. improvising framework for the current study one implication comes from signaling theory (spence, 2002). this theory suggested that firm manager will signal quality by underpricing the new issues in the start and subsequently trading it off with earnings and dividend announcements in the presence of market imperfections later (allen & faulhaber, 1989) resulting into new and raised prices (grinblat & hwang, 1989). from here, it is construed that managerial ability plays a sensitive role in moderating the decision of dividend initiation/termination. managerial ability refers to a manager’s genotype together with his pertinent environment portraying the phenotype (nuthall, 2001). so, it’s the intellect and experience both comprising managerial ability construct (park & song, 2019). another evidence regarding significance of managerial ability comes from upper echelons theory (mason & hambrick, 1984) postulating that outcomes of an organization are highly controlled by the managerial attributes of the top management team (reyna, 2017). hence, understanding of manager along with his preferences about dividends initiation and termination will play a significant role. a manager with high level of ability will better able to conduct a dividend decision specifically when policy uncertainty is prevailing. in the period of uncertainty investor prefers to grab a dividend rather to wait for a capital gain falling for famous proverb that “a bird in hand is better than two in bush” (gordon, 1959; linter, 1962). literature has ample evidence that flags how style of management and type of ownership juggles with relationship between what a firm earns and what it pays as dividend. speculator type of managers are prone towards lesser payments of dividends as proposed by agency theory and more they retain to reinvest or for future use (guan et al., 2018). it has been studied by many researchers that increase in managerial ability will lead to decrease in dividend and they also found that an increased managerial ability aligned dividend payments with tax efficient dividend policies (chetty & saez, 2005; moser ,2007; jacob and jacob, 2013). but confronting assumptions of perfect capital market that managers are perfect substitutes it is argued that managers are not identical, and the assumption is practically unrealistic (jiraporn, 2016). hence, it is hypothesized that managerial ability plays moderating role between epu and dividend policy. built on the pillars of agency theory (ross, 1973) literature argues that dividend payments are lucrative offer for the existing and future shareholders but the managers feel bad about this provisional cash flow going out of their hand that they could have used to generate more profits and put into the business cycle for long term growth (attig et al., 2018). this flow of information has contributed to the development of following second hypothesis: south asian review of business and administrative studies vol. 2, no. 1, june 2020 70 h2: managerial ability moderates the relationship between epu and dividend decision. professional vs. owner ceo: corporate world makes three types of major decision named as dividends, investment and financing decision (brealey, 2012). these decisions are key determinants of future prosperity of a firm (park & song, 2019). a firm’s strategic choices are highly influencing by the experience, intellect, background, status, ability and personality of a manager (bertrand & schoar, 2003; mason & hambrick, 1984). here, we cannot ignore the difference that can be made by the thing that if he is employed as a professional ceo/manager or an owner ceo/manager. a professional ceo is one who is working against a salary and owner ceo is one who own the firm or has major shareholding in the business (park & song, 2019). another recent advancement in the literature is the type of manager (park et al., 2019) as a manager in a firm can be hired professional (agent) serving his/her expertise on compensation been awarded every month or he/she can be an owner/shareholder of the firm that he is managing as well (principle) which is some time also called as owner ceo. fenn and liang (2001) found that dealing with insider ownership in a firm mitigates agency cost and, hence, amplifies dividend payout. study by guan et al., (2018) defined insider ownership (inside) as the shareholding percentage of insiders. they hypothesized coefficient on inside to be positive. current study infers that a professional ceo is more profound with market needs and profit making and sustaining it. even in the time of uncertainty/shocks professional ceo with strong managerial ability might initiate/sustain dividends not terminate dividend. this hypothesis is again highly supported by upper echelon theory as the strategic choices are highly influenced by the experience, intellect, background, status, ability and personality of a manager. current study draws data from firms where management is closely hold either by a professional ceo or an owner ceo. segregating data on the basis of this shoot gives a clearer picture of how managerial ability can make a difference in the relationship between epu and dividend decision. it means if we have a more professional manager, he is one with high managerial ability than there is an increased probability that he will initiate/sustain dividends even in the time of epu. previous literature argues that a more risk averse behavior has been observed towards professional ceo’s in comparison with owner ceo’s (amihud & lev, 1981). rationale behind the argument lies in the fact that professional ceo’s have the choice that they can ignore too risky investments requiring more of the effort because of moral hazard (mintzberg; waters, 1982). this evidence from the literature builds a new argument that a professional ceo avoiding other investment opportunities will be available with more funds to distribute as dividend as he also wants to avoid risk. therefore, a professional ceo will pay dividends to avoid risk specifically in the time of uncertainty. on the other-hand an owner ceo will seek more explosive ideas and opportunities and willing to go an extra mile bearing all the risk and make new investments even in the time of epu and will refrain from dividend payments. this leads to the third hypothesis of study. h3: professional ceo positively moderates relationship between epu and dividend decision. methodology the study focuses on non-financial listed firms from an emerging economy of china. sample consists of 1,153 chinese firms listed on shenzhen and shanghai stock exchanges. the study period is from year 2006-2015. we merge firm-level data with epu index advanced by baker et al., (2016). non-availability of data to construct our managerial ability measure limit our sample data to 1,153 non-financial listed firms. source of chinese firm level data is china stock market & accounting research (csmar) database. to overcome the outliers influence, we winsorize firm-level variables at 1st and 99th percentiles. findings & discussion south asian review of business and administrative studies vol. 2, no. 1, june 2020 71 to econometrically analyze our study first hypothesis, how economic policy uncertainty affects dividend policy, we use two models that are based on 𝐷𝑖 and 𝐷𝑡 dummy. we employ the following logit models (equation 1 & equation 2) to assess the effect of explanatory variables on the probability of terminating the dividend by dividend payers, and probability of initiating the dividend by non-dividend payers during period of uncertainty. 𝐷𝑡 = 𝛽1𝐸𝑃𝑈 + 𝛽2𝑑𝑡𝑎 + 𝛽3𝑟𝑒𝑡𝑒 + 𝛽4𝑟𝑜𝑎 + 𝛽5𝑚𝑣 + 𝛽6𝑐𝑎𝑠ℎ + 𝛽7𝑠𝑡𝑑 + 𝜀𝑡 … . . (1) 𝐷𝑖 = 𝛽1𝐸𝑃𝑈 + 𝛽2𝑑𝑡𝑎 + 𝛽3𝑟𝑒𝑡𝑒 + 𝛽4𝑟𝑜𝑎 + 𝛽5𝑚𝑣 + 𝛽6𝑐𝑎𝑠ℎ + 𝛽7𝑠𝑡𝑑 + 𝜀𝑡 … . . (2) suppose, y is a dividend decision binary response variable as (y∈ {dt, di}), q represents the epu, and m is a vector variable which contains characteristics of firms, year fixed effect, and a constant. the logit regression model for 𝐷𝑡 decision takes the following form that assumes the likelihood of terminating dividend: 𝑃 (𝐷𝑡 = 1) = 𝐸𝑥𝑝(𝛼𝑄 + 𝑀𝛽) 1 + 𝐸𝑥𝑝(𝛼𝑄 + 𝑀𝛽) … … (3) similarly, likelihood of initiating dividend decision takes the following form: 𝑃 (𝐷𝑖 = 1) = 𝐸𝑥𝑝(𝛼𝑄 + 𝑀𝛽) 1 + 𝐸𝑥𝑝(𝛼𝑄 + 𝑀𝛽) … … (4) in equation 3, exp (.) is exponential absolute wherein coefficient estimates are 𝛼 and 𝛽. chances of firms to terminate dividend is the ratio of probability of firms to terminate dividend (p (𝐷𝑡 =1)) to the probability of dividend paying firms (1-p (𝐷𝑡 =1). analogously in equation 4, chances of firms to initiate dividend is the ratio of probability of firms to initiate dividend (p (𝐷𝑖 = 1)) to the probability of non-dividend paying firms (1-p (𝐷𝑖 =1). in equation 1 & 2, we also control for the firm characteristics that effect dividend decisions include asset growth (dta), return on assets (roa), retained earnings (re), cash holdings (cash), market value (mv) and firm risk (standard deviation of monthly stock return). to test our study second hypothesis, we re-estimate baseline model (1&2) to analyze the moderating role of managerial ability on dividend policy during epu as below: 𝐷𝑡 = 𝛽1𝐸𝑃𝑈 ∗ 𝑀𝐴 + 𝛽2𝑑𝑡𝑎 + 𝛽3𝑟𝑒𝑡𝑒 + 𝛽4𝑟𝑜𝑎 + 𝛽5𝑚𝑣 + 𝛽6𝑐𝑎𝑠ℎ + 𝛽7𝑠𝑡𝑑 + 𝜀𝑡 … . . (5) 𝐷𝑖 = 𝛽1𝐸𝑃𝑈 ∗ 𝑀𝐴 + 𝛽2𝑑𝑡𝑎 + 𝛽3𝑟𝑒𝑡𝑒 + 𝛽4𝑟𝑜𝑎 + 𝛽5𝑚𝑣 + 𝛽6𝑐𝑎𝑠ℎ + 𝛽7𝑠𝑡𝑑 + 𝜀𝑡 … . . (6) to test our study third hypothesis, professional ceo positively moderates relationship between epu and dividend decision. we segregate our sample firms on the basis of professional and owner ceos, and re-estimate baseline regression model (1&2) for the sub-sample of professional and owner ceos. in current study, we define ceos as either owner or professional ceos, and ceos are define as managers holding position of representative directors. owner ceos are the one holding majority shares and professional ceos doesn’t hold majority share (oh et al., 2010). as in consistency with park & song (2019), if a firm has more than two representative directors we first classify director on the basis of top ranking and if they are on same rank, classify director on the basis of their shareholding to categorize the management hierarchy. dependent variable of this study as in equation (1&2) are 𝐷𝑖 (dividend initiation) and 𝐷𝑡 (dividend termination) decision variables. existing studies on dividend has documented a general time trend wherein dividend has declined over a time in recent decades (fama & french, 2001). omitted time trend may lead to measurement error, if the time trend is not properly addressed in level of dividend policy. our data sample covers 1,153 firm-year observations from year 2006-2015. these facts may lead to issues while estimating dynamic changes in dividend payout policy in response to epu. while south asian review of business and administrative studies vol. 2, no. 1, june 2020 72 considering these concerns, current study emphasizes on the changes in dividend policy rather than changes in epu itself. therefore, instead of dividend payout our main variable of interest is dynamic changes in dividend policy: 𝐷𝑖 and 𝐷𝑡 dummy variables. more precisely, 𝐷𝑖 is define as follow. we first categorize study sample as dividend payers and non-dividend payers. we define 𝐷𝑖 for firms that have not paid dividend in any of the past three years and categorized as past nonpayers. if the dividend past non-payers start paying dividend in current year, assign a value of 1 to 𝐷𝑖 , else 0. similarly, define 𝐷𝑡 for firms that have paid dividend in all of the past three years, and categorized as past payers. if the past dividend payers stop paying dividend in current year, assign a value of 1 to 𝐷𝑡 else 0. study main explanatory variables are epu (equation 1&2) and epu*ma (economic policy uncertainty*managerial ability, equation 5&6). to measure managerial ability, study employs demerjian et al., (2012) method that outperform other managerial ability measures and maintains an ordinal ranking of manager’s ability for a large number of sample firms by separating managerial ability from the firm efficiency. we also control for number of control variables by following extant literature (fama & french, 2001; chay & suh, 2009) such as; asset growth (dta), return on assets (roa), retained earnings (re), cash holdings (cash), market value (mv) and firm risk (sd, standard deviation of monthly stock return). table 1 reports key statistics of study variables. panel a summarizes the number of firm-year observations, mean, standard deviation, minimum and maximum value for each variable. first two rows confirm the rarity of dramatic changes in dividend policy, reports firm follow sticky pattern of dividend payments. such as, 𝐷𝑡 mean is 0.123, which shows out of past-payers sample, 8,723 firm-year observations, only 12.3% firm has terminated dividend. for the past non-payer’s sample, 2,792 firm-year observation, 𝐷𝑖 mean is 0.746 means 74.6% has initiated dividend. panel b reports correlation matrix for study main variables. 𝐷𝑡 is negatively related to epu*ma and 𝐷𝑖 is positively related to epu*ma. as the pearson correlation between epu*ma and 𝐷𝑡 is -0.142, and between epu*ma and 𝐷𝑖 is 0.316. panel b reports preliminary view of relationship that suggests talented mangers are more like to initiate and less likely to terminate dividend with high epu. in next section a relationship is addressed in the context of multivariate regression context. table 1: summary statistics a: summary statistics variab les obs mean s std.d ev min max dt 8,723 0.015 0.123 0 1 di 2,792 0.746 0.435 0 1 ma 11,515 0.024 0.181 -0.809 0.579 epu 11,515 148.4 84 78.73 6 60.38 7 304.2 21 epuma 11,515 5.640 29.80 3 196.2 81 175.7 68 dta 11,515 0.026 0.370 -1.000 18.07 9 rete 11,515 0.244 0.630 -4.345 6.941 roa 11,515 0.750 0.594 -1.990 2.000 south asian review of business and administrative studies vol. 2, no. 1, june 2020 73 mv 11,515 22.64 1 1.289 11.85 8 29.56 2 cash 11,515 1.160 1.199 -0.756 7.902 sd 11,515 0.164 0.104 0.013 2.770 b : correlation matrix dt di epu epum a dta re roa mv cas h s d dt 1 di 1 epu 0.165 -0.090 1 epum a -0.142 0.316 0.083 1 dta -0.033 0.036 0.003 0.001 1 rete -0.021 0.005 0.013 0.029 0.079 1 roa -0.030 0.084 -0.031 0.080 0.01 -0.005 1 mv -0.038 -0.016 0.036 0.148 -0.034 0.050 0.101 1 cash -0.021 0.043 0.028 0.102 -0.008 0.030 0.084 0.237 1 sd 0.008 -0.008 0.109 0.086 0.008 0.003 0.019 0.115 0.11 3 1 table 1 reports summary statistics and correlation estimates of study main variables. here, dt is the dividend termination dummy, di is the dividend initiation dummy, epu is economic policy uncertainty index, epu*ma is the multiple of managerial ability and epu, dta is the growth rate of assets, rete is retained earnings-to-total equity ratio, roa is return on assets, mv is firm size, cash is cash holdings, and sd is stock return volatility. detailed variable definitions are given in appendix a. s.deviation is given in parentheses. ***, **, and * next to coefficients indicate that coefficients are significantly different from zero at the 1%, 5%, and 10% confidence levels, respectively. regression estimates table 2 reports logit regression estimates to test study hypothesis. model 1 is to analyze how uncertainty caused by policy uncertainty effects dividend decision. model 2 is to evaluate the moderating role of managerial ability on dividend decision during epu. model 1 first examines the impact of epu on dividend decisions, and result shows that epu is positively related with 𝐷𝑡 decision while it has negative relation with 𝐷𝑖 decision. the value of coefficient of epu is 0.056 (significant at 1% level), and it indicates that past dividend payers are terminating dividend payouts by approximately 30.24% (= [exp (0.008*78.74)-1]*100%) in response of one standard deviation increase in epu. our results indicate that past dividend payers are more likely to terminate dividend during period of epu. the result shows that epu has statistically significant negative impact on dividend initiation with a coefficient of -0.017 (highly significant at 1% level). our results indicate that a past non-payer initiate dividends by approximately 0.09% (= [exp ((-0.017)*78.74)-1]*100%) in response of one standard deviation increase in epu. thus, finding indicates that past non-dividend payers are less likely to initiate dividend during period of policy uncertainty. model 2 results report the moderating role of ma on dividend decisions during epu, as epu*ma is significantly negatively related with 𝐷𝑡 decision while it has positive relation with 𝐷𝑖 decision. that confirms past dividend payers with talented managers terminate dividend payouts by south asian review of business and administrative studies vol. 2, no. 1, june 2020 74 approximately 21% (= [exp (-0.018*29.80)-1]*100%) in response to one standard deviation increase in epu. thus, our results indicate that past dividend payers with talented managers are less likely to terminate dividend during period of uncertainty. moreover, model 2 confirms past non-dividend payers with talented managers initiate dividend payouts by approximately 10.35% (= [exp (0.112*29.80)-1]*100%) in response to one standard deviation increase in epu. therefore, table 2 suggests past dividend payers are more likely to terminate and less likely to initiate dividend, but when managerial ability is introduced as a moderator, past non-payer firms are more likely to initiate dividend and past payer firms are less likely to terminate dividend payments at the time of epu that supports our first hypothesis. our results support signaling and upper echelon theory as more talented managers will signal quality by underpricing the new issues and subsequently trading it off with earnings and dividend announcements in the presence of market imperfections such as epu (allen & faulhaber., 1989), and firm dividend decisions are very much predicted by the talented managers (reyna, 2017). these results are also in consistency with xiao et al., (2019), firms with more talented managers are more likely to initiate dividend and less likely to terminate dividend during uncertainty period. table 2: moderating role of managerial ability on di/dt decision during epu variables dividend decisions model1 model2 dt di dt di epu 0.056** (0.028) -0.017*** (0.003) epu*ma -0.018*** (0.002) 0.112*** (0.008) dta -1.890*** (0.468) 0.945** (0.362) -2.305*** (0.514) 1.069** (0.444) rete -0.160 (0.133) 0.287** (0.127) -0.126 (0.147) 0.298** (0.151) roa -0.231 (0.140) 0.387** (0.119) -0.164 (0.155) 0.251* (0.144) mv -0.279*** (0.074) 0.112* (0.064) -0.255** (0.084) 0.100 (0.081) cash -0.100 (0.096) -0.002 (0.061) -0.060* (0.102) -0.020 (0.072) sd 0.890** 0.487 -0.593 (1.243) 0.737 (0.578) -0.806 (1.602) year dummies yes yes yes yes no of obs 7,893 2,792 7,893 2,792 pseudo r2 0.08 0.16 0.03 0.21 notes: this table presents logit regression estimates for the moderating role of managers ability on dividend decisions based on 2 models over the period 2006 to 2015. here, dt is the dividend termination dummy, di is the dividend initiation dummy, epu is economic policy uncertainty index, epu*ma is the multiple of managerial ability and epu, dta is the growth rate of assets, rete is retained earnings-to-total equity ratio, roa is return on assets, mv is firm size, cash is cash holdings, and sd is stock return volatility. detailed variable definitions are given in appendix a. s.deviation is given in parentheses. ***, **, and * next to coefficients indicate that coefficients are significantly different from zero at the 1%, 5%, and 10% confidence levels, respectively. managerial ability, dividend decisions and epu (professional vs owner ceos) south asian review of business and administrative studies vol. 2, no. 1, june 2020 75 as we have already discussed in the earlier section of hypothesis development, there is distinct difference between professional and owner ceos performance during uncertainty. thus, we further analyze the moderating role of managerial ability on dividend policy during epu by segregating our sample firms into owner and professional ceos. table 3 reports two models, model 1 is to analyze the moderating role of managerial ability on dividend policy during epu by professional ceos, and model 2 is for the owner ceos. as the professional ceos are more risk averse as in comparison to owner ceos (caliskan & doukas, 2015; amihud & lev, 1981), therefore, they are more likely to moderate the relationship between ma and dividend payout decision, by enforcing firms to initiate more dividends and terminate less dividends during epu. however, owner ceos are not moderating the managerial ability role on dividend policy during epu because they are risk-seekers and inclined to more investment rather than paying dividends. they seek more explosive ideas and opportunities and willing to go an extra mile bearing all the risk and make new investments even in the time of epu and will refrain from dividend payments (park & song, 2019) table 3: moderating role of managerial ability on di/dt decision during epu (owner & professional ceos) variables dividend decisions model1 model2 professional ceos owner ceos dt di dt di epu*ma -0.026** (0.005) 0.162*** (0.013) -0.002 (0.004) 0.007 (0.016) dta -1.650* (0.853) 0.734 (0.587) -3.251** (0.986) 2.220** (0.964) rete -0.186 (0.209) 0.543** (0.257) -0.078 (0.253) -0.060 (0.346) roa -0.109* (0.224) 0.175 (0.220) -0.283* (0.273) 0.422* (0.254) mv -0.096* (0.138) 0.098* (0.114) -0.370** (0.110) 0.110* (0.133) cash -0.057 (0.158) -0.087 (0.101) 0.066 (0.191) -0.012 (0.125) sd -0.169 (0.795) -0.536 (2.647) 1.803 (1.351) -0.398 (2.26) year dummies yes yes yes yes no of obs 2,493 1560 4,492 1232 pseudo r2 0.02 0.16 0.01 0.22 notes: this table present logit regression results for the moderating role of ma on dividend termination decision and dividend initiation decision for chinese firms over the period from year 2007 to 2015 by segregating data based on professional and owner ceos. here, dt is the dividend termination dummy, di is the dividend initiation dummy, epu is economic policy uncertainty index, epu*ma is the multiple of managerial ability and epu, dta is the growth rate of assets, rete is retained earnings-to-total equity ratio, roa is return on assets, mv is firm size, cash is cash holdings, and sd is stock return volatility. s.deviation is given in parentheses. ***, **, and * next to coefficients indicate that coefficients are significantly different from zero at the 1%, 5%, and 10% confidence levels, respectively. s.deviation is given in parentheses. ***, **, and * next to coefficients indicate that coefficients are significantly different from zero at the 1%, 5%, and 10% confidence levels, respectively. south asian review of business and administrative studies vol. 2, no. 1, june 2020 76 robustness tests to control possible study employs instrumental variable regression approach. we first check endogeneity of endogenous variable and the results of endogeneity test are presented in appendix a. endogeneity test results confirm the endogeneity of managerial ability, thus we use two instruments as zip code average and earliest year managerial ability. we replace the value of current year managerial ability by the earliest year managerial ability to reduce reverse causality. as the earliest year managerial ability could not have resulted from subsequent year dividend policy, it is unlikely that dividend policy in any of the subsequent year affect the earliest year managerial ability (jiraporn et al., 2016). zip codes are assigned for provinces based on address or mail deliveries, they are unlikely related to firm performance and they are likely exogenous (jiraporn et al., 2016; chintrakarn et al., 2018). then, we employ the instrumental variable regression analysis using gmm (generalized method of momentum) estimation technique to control possible endogeneity. table 4 shows similar results to confirm baseline regression. hansen test (p-value) confirms that our instruments are valid, and the c (sargan test statistics difference) reports endogeneity. instrumental regression shows similar results as firm with talented mangers are more likely to terminate and less likely to initiate dividend during epu. table 4: instrumental variable regression analysis variables dividend decisions dt di epu*ma -0.002** (0.0001) 0.041*** (0.004) dta -0.013** (0.004) 0.015* (0.01) rete -0.002* (0.002) 0.022** (0.031) roa -0.004 (0.002) 0.033 (0.038) mv -0.002* (0.002) 0.033** (0.016) cash -0.001 (0.001) -0.019 (0.016) sd -0.002 (0.028) -0.069 (0.285) no of obs 2,493 2792 c statistics 0.030 0.000 hansen test (p-value) 0.819 0.9743 notes: this table presents instrumental variable regression using gmm to analyze moderating role of ma on dividend decision during epu from year 2006 to 2015. here, dt is the dividend termination dummy, di is the dividend initiation dummy, epu*ma is the multiple of managerial ability and epu, dta is the growth rate of assets, rete is retained earnings-to-total equity ratio, roa is return on assets, mv is firm size, cash is cash holdings, and sd is stock return volatility. s.deviation is given in parentheses. ***, **, and * next to coefficients indicate that coefficients are significantly different from zero at the 1%, 5%, and 10% confidence levels, respectively. conclusion in this paper, empirical investigation of moderating role of managerial ability on dividend decision during the period of economic policy uncertainty is done. by using data of 1,153 non-financial chinese firms from the year 2006-2015 study stands evident that more talented managers during period of epu help firms to sustain dividend. that confirms, past dividend payers/non-payers with more talented managers are less/more likely to terminate/initiate dividend during period of epu. south asian review of business and administrative studies vol. 2, no. 1, june 2020 77 therefore, it is consistent with the concept that firms with talented managers are less likely to cut dividends unless they are confident that they will maintain same level for long term even during period of epu. they are not afraid of increasing or decreasing dividend payments as they are less concerned to reduce them later (jiraporn et al., 2016). hence, talented managers are less concerned about paying large dividend and having to cut them in future. results demonstrate that magnitude of the effect of managers’ ability on dividend decision is statically significant during epu. second, this study analyze the relationship by examining the moderating role of managerial ability on dividend decisions during epu by segregating the data based on firms having professional and owner ceos, and found that professional ceos more profound with market needs and profit making and sustaining it even during period of epu that strengthen the moderating role of managerial ability on dividend decisions. even in the time of uncertainty/shocks professional ceo with strong managerial ability might initiate/sustain dividends not terminate dividend due to their risk avoidance nature (amihud & lev, 1981; mintzberg & waters, 1982). study further carries out instrumental variable regression approach for controlling possible endogeneity. this is the first study that investigates the moderating role of managerial ability on firms’ dividend decisions during epu. this study is of interest to board of directors while considering cost and benefits of hiring executives, as well as for stakeholders, regulators, and academicians interested in understanding how homogeneity of managers, and individual decision-makers affect firm dividend policy during epu. policy makers and regulatory agencies should also consider manager homogeneity as executive attributes such as demographics, human and social capital, political connections of managers help firms in accessing external funds, and their impact on firm policies. this study may be helpful for regulatory bodies and policy makers to make policies and planning regulations such as pricing employee compensation. this study documents that managers ability is an important determinant of dividend policy. thus, investors seeking good return over their investment have to consider managers ability. our study is subject to several limitations. first, we are unable to observe managers’ daily decision-making, and we rely on financial statement information to infer managers’ strategic choices. second, our managerial ability measure is based on demerjian et al., (2012) measure extensively used in literature, but we may not fully eliminate the likelihood of individual abnormal performances. thus, result interpretations are ought to caution. third, this study is limited to emerging economy of china having different financial structure and accounting standards, therefore future researchers can extend this study for other emerging economies. third, this study analyzes the 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(1984). explaining investor preference for cash dividends. journal of financial economics, 13(2), 253-282. spence, m., 2002. signaling in retrospect and the informational structure of markets. american economic review, 92(3), pp.434-459. south asian review of business and administrative studies vol. 2, no. 1, june 2020 15 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.1, june 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas investigating the impact of political stability, trade liberalization, and investment incentives on the fdi inflows in pakistan affaq akram, institute of business, management and administrative sciences, the islamia university of bahawalpur, pakistan, article details abstract history revised format: may 2020 available online: june 2020 keywords fdi inflows, political regime, trade liberalization, financial development, world bank this study examines the impact of the political stability and trade openness, trade liberalization and investment incentives on the fdi inflow of pakistan. fdi in all over the world has been growing at a spectacular pace and pakistan as an emerging economy has been successful in attracting more fdi compared to developed countries. the data for this study were collected through the world bank (world bank indicator database) and the global economy from the period of 1995-2018. the procedure of ardl bound testing was applied to observe the association between fdi and political stability alongside other indicators such as trade openness, and incentives to investments in pakistan. tests were carried out to observe short-run and long-run relationships. fdi inflow were found to be significantly and positively influenced by trade openness and incentives in the long run. for the policymakers, the implications in our research underlie improvements to political establishments and a stable democratic system along with investor’s friendly long term policies that are central to attracting more fdi in pakistan. moreover, the government should focus on removing uncertainties which lead to instabilities. stable government may manage credible trade reforms to further liberalize its trade to enhance fdi inflows and reduce tariffs with the motive of providing incentives on investments. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: affaqakram@gmail.com doi: https://doi.org/10.52461/sabas.v2i1.444 introduction in the context of pakistan, the structure in private universities of pakistan is autonomous, and have been facing continuous changes (zulfqar & valcke, 2014). the changes such unnecessary authority is given to the registrars and the vice-chancellors (sial, jilani, imran, & zaheer, 2011), and poor governance of universities lack of accountability have also been prevailing in the highereducation institutes (sial et al., 2011). https://journals.iub.edu.pk/index.php/sabas mailto:affaqakram@gmail.com https://doi.org/10.52461/sabas.v2i1.444 south asian review of business and administrative studies vol. 2, no. 1, june 2020 16 fdi plays a significant part in a country’s economic growth by the way of transferring knowledge, expertise in technological and management advancement (hansen & rand, 2006). the connection between the openness of the trade with regards to fdi inflow is not as simple as it seems. first of all, it is contended that determinants of fdi and exchange are comparable; in this way, what decides the exchange likewise decides fdi inflow (ekholm & södersten, 2002). also, appraisals to in which fdi econometric models fares, the imports are resolved that they are endogenous factors at the same time contended (hejazi & safarian, 2003). last but not the least, concerning studies shows at the blow of trade agreements of the region on fdi inflows show some impact. the impact shows that fdi inflows influenced by trading agreements. so that the territorial integration accompanied to the risk attached with the investments decline. however, the fdi inflows with regards the global trends have not been persuading and require more consideration over the globe of drivers that are important for fdi inflow. according to global investment competitiveness report 2017, there was a substantial decrease in the fdi inflow global fdi. the substantial decrease is 23 percent to $1.43 trillion in 2017. the host governments pose challenges by such a substantially decrease in fdi inflows to devise foreign investors are attracted by suitable policies of industry and investment because the expert's characteristics fdi inflows considerable decline over the world to variables of policy-relation (oecd report 2018; unctad report 2018). there have furthermore declined by 19% in the fdi inflow to $1.2trilion; some of the developed nations got such fall majorly while due to market liberalization policies, fdi inflow in china was the highest and it was the largest recipient of fdi inflows and developing countries remained stabilized (unctad report 2019). however, the property and contractual rights related policies depending upon the several types of institutional quality and the political regime for foreign investors(clague, keefer, knack, & olson, 1996; duanmu, 2014; harms & ursprung, 2002). various incentives as tax/tariff incentives provided to the foreign and local investors during the last 2 and ½ decades. there is the existence of tariffs or ctr with a relationship to the domestic investment and fdi is not evidenced in pakistan. apart from this, no significant study or research demonstrate if there have had impacts on the investments (fdi and domestic) of tax incentive in pakistan. the focus of this study is to identify that domestic investment and fdi are affected by non-tax factors. husain (2009) noted that a beneficial business environment relies heavily on political stability in a country. the probable downturn of business activities could result from political risk that comes from change in governments, change in legislative bodies and military control. normally, it is obvious to understand that the governments of democracy reign are having less political risk because of better provision contractual and property rights. the tenure of 2000 to 2007 is considered to be the most successful era with regards to the economic policies (lodhi, 2017). according to the military reign period, pervaiz musharraf former president of pakistan introduced the economic regulations program (erp). by opening the international trade the economy of pakistan’s increases as the objectives of principal trade policy became a rapid reduction in anti-export and import biases. regulatory duties, import surcharges, and quotas were removed by the government of that such successful era. it is a successful era and before 2008 tenure was the best tenure in pakistan history. according to previous years of fdis, pakistan was successful in that region. about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 17 table 1: fdi inflow of pakistan and along with its regions2006 source: world bank indicators if we see fdis of any other year, for example, we consider the trend of 2014 during the political government of nawaz sharif, the fdi of pakistan in its region is so down that can be seen in the bar table given below: table 2: fdi inflow of pakistan and along with its regions2014 south asian review of business and administrative studies vol. 2, no. 1, june 2020 18 our consequences suggest that as compared to democratic governments, the military authorities have been better able to address to attract more fdi inflow in pakistan. in developing countries, fdi is the source of providing to gain access to market competition, an increase in capital formation, and technology transfer. such factors are the main attributes to the increasing level of economic growth. by making perfect combinations of openness in trade and high macroeconomic policies, fdi can work in those ways. the government has to need fdi in such a phenomenon it is the critical source of is assisting the pool of resource creation and capital formation that leads to socio-economical advancement. fdi: economic theory suggests in developing countries fdi is the main source of boosting their economic growth. by getting as many benefits from foreign investment some of the countries such as malaysia, china, singapore, and south korea became the asian tiger. this is because the capital accumulation gets energized by fdi inflows through the addition to the efficiency in recipient raising and domestic savings. through the improvements in job creation, allocation of resources, job, industrialization, competition arising and imitation of economies of scale, technology spillovers, reduction in capital costs locally, improving human capital and strengthening financial markets domestically, firms are motivated to invest in host countries. (athukorala & wagle, 2011; haider, gul, afridi, & batool, 2017; koojaroenprasit, 2012). political stability, trade liberalization, investment incentive many factors like the political system, macroeconomic factors, and development strategy of a country affect the host country’s fdi. there are some important factors that motivate foreign investors that can happen through strategies as trade openness and some investment incentives given by the host countries. incentives seeking hypothesis, in such a case new markets must be explored by the foreign firms increase profitability and sales in the host country. due to cheaper factors of production are the sources of motivation that rent-seeking factor states(zakaria, naqvi, fida, & shahzad, 2014). trade liberalization reduces the cost that occurred in export-oriented investments to which multinational firms are engaged to lead to a higher probability. this will attract efficiency-seeking and cost-reducing fdi as the foreign firms can take advantage of importing cheap intermediate goods produced in some other country and exporting the finished products to a third or home country. open markets allocate resources more efficiently and thus may significantly create economic welfare gains. there are more chances that foreign businesses get attracted due to an economically conducive environment. as a result of this, fdi inflows may substantially increase(popescu, 2014). firms seeking efficiency use few countries to serve a larger market. location, resources endowments, and regulations are the key factors that drive such behavior. the efforts to maintain the firm's international status and competitiveness are part of the strategic asset approach which motivates foreign firms to invest in host countries. fdi inflow to developing countries like pakistan i s mainly vertical because their markets are not matured i.e. they do not have wellestablished institutions. this study reconnoiters the particular case of pakistan and analyzes the factors like political stability, openness to the trade as liberalization and incentives of investment affecting fdi inflows to the country. the objectives of the research are to discover the actual elements which can allow fdi in pakistan by examining the following factors: about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 19 ● to identify the factors that influence fdi inflow in pakistan. ● to investigate the impact of political stability over the fdi inflow in pakistan. ● to analyze if (conduct a detailed analysis to identify the motives of investment incentive that explore whether) tax holidays/tax exemptions, the incentivized tax policy, and changes in customs tariff rate affect the fdi in pakistan. literature review political stability and fdi many economists from a different region of the world have asserted that the attractiveness of fdi inflow for a country has key ensuring due to political stability. in a series of papers, kraay, kaufmann, and mastruzzi (2010) contended that in order to achieve a higher level of investments by the foreign investors it is important for such countries to that they should focus on considering political stability and some other factors like control of corruption and infrastructure. in this way, these countries will have good chances of attracting more fdi towards the corresponding countries as there high competition and a great environment of global business. there are some factors among which political stability is the most important according to the economist arguments which states that the large extent of growth and economic progress of a country is committed by the stability in its political and democratic system and effectiveness in regulation quality and transparency (globerman & shapiro, 2003). the political stability and violence are the risk factors or attracting and expelling the fdi inflow. a better system of political stability is the sources of attracting fdi inflow and political instability of a country that have higher risks of expelling fdi inflow. these arguments are noted down in the literature of international business that refers to the commonly specific factors of a country as risk factors either attracting the fdi inflow or expels the inward fdi (knack & keefer, 1997). there are many scholars who had done the empirical studies to investigate the associated relationship between political stability and inflow of fdi. asif, majid, yasir, and ali (2018) found that fdi inflow is highly encouraged by the stability in the government and low level of of external conflicts by using ardl testing procedure to see long-run relationship in the perspective of pakistan. nazeer and masih (2017) also investigated the short-run and long-run association between the political stability and inflow of fdi by using the co-integration approach through the autoregressive distributed lag (ardl) model. kurecic and kokotovic (2017) find a long-run relationship between the fdi inflow and political instability for the small economies work on panel basis by using vector autoregressive estimates (var) and the granger causality test. these results are applied only on small economies but there was no relationship existed in larger economies. in addition, nadeem also studies the long-run impact of political stability with fdi inflow with the help of using granger multivariate causality test. further we are going with more arguments that country have chances that continues on improving fdi inflow consistently through the vital role political stability. globerman and shapiro (2003) concluded that there are several factors advanced education, low level of violence , infrastructure keep on improving by the key role of political stability. these improvements lead to the well defined provision of human capital. this is the key source of attracting inflow of fdi in a country. it is obvious that mncs never risks their capital in unstable counties but they prefer work in a stable environment so that they are always willing to invest in those countries that are politically stable. the reason behind the bar is that systems donot works properly in unstable political countries and investors can experience many hurdles and difficulties. a wide range country factors specifically studied related to fdi inflow by the scholars of international business (allen & aldred, 2013; habib & zurawicki, 2002; torriti & ikpe, 2015). the main motive here is that a progress of a country is facilitated by the political stability. the governments are enabled on settling their about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 20 plans and keeps on implementation so that it will help in improving country’s infrastructures. the governments with stable political conditions develops the unruffled and stimulated atmosphere. this atmosphere engages the political system that enables in establishing the strategies aimed at country’s development. this concludes that a country’s economic development boosts up with the political stability significantly. kim (2010) explores the association between political stability and fdi inflow, as well as the level of corruption. he proposed that by using the political rights measuring the political stability, there exists negative relationship of political stability and fdi inflow. moreover, he found some interesting results that there is positive relation of fdi inflow with the corruption. he defended these results by giving arguments that high level of corruption among the government leads to more fdi inflow and less fdi inflow with the low level of corruption. the fact is that this happens because non residential companies due to superior treatment in those countries are more likely to invest. consequently, it remarkable that these results and relationship could be recalled whether there is positive affect of corruption on fdi inflow and significant affects of political stability on inflows of fdi. is considerably noticeable that the measurements of variable political stability were different from what he was taking into consideration. political risks largely depend on political stability and good governance of the government (husain, 2009). political stability enhances the probability of attracting more fdi inflows into the developing countries. pakistan has been suffering from the instability of the political system, this in turn; may adversely affect the inflow of fdi into pakistan and discourages the international investment. the ever changing political system and the unstable government can cause political risks which, in turn; will adversely affect the level of foreign and domestic investment in the country. if the country’s political stability condition is not good, foreign investors will hesitate to bring any projects until they are assured that the business environment would to be conducive and favorable (jawad-ul-hassan) (brada et. a.l, 2005; word bank, 2011; unctad, 2010). in the case of pakistan, world bank report, published in 2011 categorically mentioned that the private sector low investment in the country is because of political instability and corruption. in today’s world there are many features that are considered to be significantly important for investors to establish their business in any environment, one of these is the degree of the political stability of the country in which they are planning to enter for business. this is the more significant factor in determining the flow of fdi into any country (lambsdorff, 1999). tuman and emmert (2004) however, traced that political instability and riots and regular constitutional changes in government significantly affected fdi inflows in the developing country. political stability is essential for the country’s smother economic growth. recently in pakistan since the year 2008, political stability has registered a declining trend. as a result, foreign investments are declining in pakistan. the report of uncatd (2011) in pakistan less domestic sector investment the main reason is the political stability of the county. data in table 10 highlights that pakistan political stability index is going down, this is obviously critical for foreign investors to invest. anwar, saeed, khan, and ahmad (2013) investigated the determinants of foreign direct investment in pakistan for the period of 1980 to 2010. the impact of cost of war against terrorism, electricity generation, political stability, inflation, gdp, incentives offered to investors, trade openness and exchange rate with inflows of foreign direct investment was estimated by applying arma and ordinary least squares (ols) regression techniques. the results revealed that electricity generation, gdp, exchange rate, incentives provided to investors and trade openness had significant and positive relationship, whereas, political instability and cost of war against terrorism had significant and negative relationship with fdi inflows in pakistan. h1: political stability has a significant positive effects on fdi inflows in the host country. about:blank about:blank about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 21 trade liberalization and fdi trade openness, that means the gradation of trade liberalization of a host country, is regarded as a vital component that promotes fdi (afridi, gul, & haider, 2018). aizenman (2005) found a relationship in the case of fdi and trade. he investigated that in developing countries to what extent the linkage between fdi and international trade exists. for the different categories of fdi and trade, several methods were used for the purpose of investigation of two-way feedback. for the investigation of manufacturing trade and fdi, strong feedback occurred in order to investigate a two-way response. such results happened after the control of institutional and macroeconomic effects. the same kind of results was found in order to see the association between fdi inflow and toi. antras and caballero (2009) mainly focused on studies to check the relation between capital inflow and trade. according to their arguments, the diversification of financial development in this world with the economies of less developing countries has the supplements of capital inflow mobility and trade. the complementarily occurs over to financial capital flows in a dynamic framework. this interaction is important in such a way of gaining excess to the capital flows and it implies that strengthening in trade integration raises net capital inflows in developing economies. when the restriction in trade is minimized in the host countries, it happens because removing trade barriers such as the decrease in import quotas and duties. so it is obvious to perceive that such countries are the motivation of investors to invest to get benefits of trade. and hence such countries are highlighted as they tend to increase the trade openness as the trade liberalization. aizenman and noy (2006) founded the two-way dimensional association between fdi and openness in trade. vijayakumar, sridharan, and rao (2010)distinguished the negative impact of fdi and liberalization of trade as openness in trade. liargovas and skandalis (2012) use an instrument to check the effect of openness in trade in attracting fdi. by using eight measures in the developing countries he got the results that openness in the trade has a positive impact on fdi of a country in the developing economies. belloumi (2014) from tunisia develop results to see the associations between fdi and openness in trade. r. e. a. khan and adnan hye (2014) stated that if there are fewer tariff rates and restrictions in the trade that implied by the liberalization then investor for the sake of benefits gets cost efficiency in investing such kind of hosting countries. this study is mainly focused to check the impact on political relations of pakistan with international economies from the span of 1972-2009. it is estimated that pakistan has less or no influence by the us territory policies with regards to the flow of capital in the long run. in the same context, u.s failed policies of diplomacy have resulted that influenced negatively to the inward flow of fdi in pakistan. so that in the short term as well as the long term we got some conclusions. there is a significant positive relation of fdi with domestic investment. also, studies explained that the impact of utilization of natural resources and the financial devilment exerts a significant positive impact on fdi. infrastructure is also seen as important with respect to fdi flows. m. h. shah and samdani (2015)conducted a study in d-8 countries and explains the associations of openness of trade with regards to the inflow of fdi in such countries. he explained that trade liberalization is positively impacting the inflow of fdi. donghui, yasin, zaman, and imran (2018)keenly studied the gdp, and other economic indicators as inflation, and exchange rate. he studies to explain the positive impact of openness on trade with fdi along which such determinants. nieman and thies (2019) and camarero, gómez-herrera, and tamarit (2018)found relations in eu countries and built a consensus that trade liberation has significant impacts on fdi. the studies explained that pakistan’s fdi must be promoted by the activities like domestic investment improvements in local infrastructure and continuity of trade openness as the trade liberalization. this shall have happened when strengthening all such resource-based activities. h2: trade liberalization has a positive effect on fdi inflows in the host country. about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 22 investment incentives and fdi etim, onyebuchi, and udo (2014)researched on fdi determinants and the impacts such determinants on the nigerian economy. there study explained that in what ways different investment determinants like political risks, openness, and exchange rate affect the fdi inflow in nigeria during their mentioned period. their study also explained that exchange rate, market size (gdp), and openness emit a foremost impact on fdi while the political risk was not a momentous factor. in the nigerian oil and gas sector, trade openness, tax incentives and natural resources available to the required had a major impact on foreign direct investment. such factors did not affect market size, political risk, and economic stability (babatunde & adepeju, 2012).to support fdi this explores the focused novel trend that objectives of economy attention should attract fdi and economic growth from the perspective of nigeria's economy. in the oil and gas sector in nigeria, such a study provides the discernment to then fdi determinants, that availability of natural resources and openness to trade that follow the incentives of tax policy. while there were several studies conducted in pakistan and a major study, majeed and ahmad (2009)explained that investors' friendly environment and enabling safety are the important frequent part of fdi. the investment and capital formation are successful in pakistan when the impacts of some allowances were observed. such observed allowances include concessions need in depreciation allowances and tax incentives such as tax holidays. aid (2014) studied ghana’s policies of incentives given on investments: the earnings exports of a country can be increased the tax incentives. such incentives are the attraction towards fdi discovered by the cost of social development. due to the decrease in the tax rate, it unveils the increase in benefits from competition. and meanwhile, in sub-saharan economies, investment and trade synchronization become weakened of trade and investment. bano and tabbada (2015) gave description about the overall overseas investment and fdi in pakistan have an indication of facts and figures that in overall overseas investment showed an increasing trend of 133.3% per annum that in 2014 an increase occurred from $1277 million to $2979 million, on the other side there was an increase in fdi to $750 million. alvarez et al. (2000) investigated the impacts of investment with regard to the expected changes in taxes. he commented in his study that there is a rapid increase in investment when the tax rates are reduced. he concluded that reduction in tax rate encourages investment and similarly if there is low reduction normally in tax rates the impacts have totally become inverse. rabushka (1987) drawn attention to the relationship between taxes and economic growth and said that there is a direct relationship between them. he emphasized that most of the use of efficiency in labor adversely impacted by high tax rates and entrepreneurship have last confidence by the capital. in this way, there’s become a straight decrease in the growth. on the other hand, the world bank gave a description about the level of taxation. according to this, the economic developments of developing countries have a positive association with taxation. bond and samuelson (1986) stated that in the short run, there is a straight decrease in tax revenue while in order to attract more fdi inflow when host countries focused on tax holidays. brander and spencer (1987) distinguished that for the home countries that seeking to entre to gain access to more fdi should minimize trade barriers. if home countries reduced tariffs on imports and tax then they can attract more fdi inflow. effiok and eton (2013) studied the relationship between economic growth and fdi and found that there is a significant relationship between them. gastanaga, nugent, and pashamova (1998) argued that the steam of investments can be used in a particular direction of the host country that bears the impact on fdi. ctr, trade, bureaucracy delay, nationalization risk, exchange rate distortions, tariff rates, contract enforcement, and corruption are different variables in the study context. about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 23 fahmi (2012) studied the impacts of incentives of tax holidays over fdi in indonesia from a time period of 1980 t0 2010. some indicators such as gross fixed capital formation, inflation, trade openness, and tax rate were observed as a source of significantly attracting fdi. while on the other hand, some negative effects established by poor policies, instabilities in political and economic structures, and a lake of infrastructure cannot be mitigated by the tax holidays. demirhan and masca (2008) concluded that economic growth, liberalization, physical infrastructure cast a positive impact in boosting fdi, whereas inflation positively affects the inflow of fdi while tax rates harm attracting fdi. z. shah, ahmed, and siddiqui (2003) analyzed that capital is dependent on various factors such as tax rates, prices of capital goods and bank markup while calculating the cost of capital. the cost of capital will be lower if the tax holidays are for a long time period or there is a greater reduction in the tax. zenjari, wahabi, haj, and drissi (2012) distinguished the impact of taxation on the profitability of investing and to that on competitiveness. munongo (2015) studied that in different sectors to what extent the tax incentives impacted. his study explained that there is the insignificant effect of tax incentives such as exemption in customs duties but the tax holidays are as much significant. oniyewu and shareshta (2005) explored that an increase in taxation demoralizing the inflow of fdi. hussain and kamuli (2012) explained in his studies in the developing countries some factors are the source of high attraction in fdi such the microeconomic indicators, stability in the financial sectors, the size of the market, and the high availability of factors of production. anyanwu (2012) disnguished that there is the association of fdi inflow with openness in trade, market size, law and order situation. bolnick (2004) recognized in some of the countries with external factors, the incentive given on the regimes have not been successful in many countries e.g. factors like political undue pressures. in this theoretical literature, it is essential for us to assess the economic scenarios and analyzing the relationships and linkages between the foreign investment and tax policies in pakistan. so that we can analyze whether incentives given on taxes in the form of rebates, tax cuts, tax holidays or tariff reductions offered in the host country have any positive impact on investments. h3: investment incentives offered by the host country have a positive effect on the fdi flows and their performance. methodology the research methodology is the process to solve the research problem. the problems are solved by the collection, evaluation, and assembling of the data. the tools in this study are used in a specific study to gather the information that is relevant to the study. a research methodology is divided into two parts. one is qualitative and the other one is quantitative. in this thesis, we are using a quantitative research method. we collect data from different sources. there are three types of research design. first is exploratory, explanatory and last is descriptive. these research methods are usefully related to the research study in a way of answering the research question. according to this research study, the research design of our research is the causal research design. in this research design, we can use the regression or vector error correction model. there are two types of sources of data. one is primary and the other one is secondary. we are are secondary sources of data in our research study. the data about foreign direct investment, trade openness, and investment incentives will be extracted by using the sources of the world bank (world development indicators), from the followings years 1972 to 2018. in such a time period the required data for all variables is available. about:blank about:blank about:blank about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 24 all variables of our study are with their measurements descriptions and proxies are explained in the variable operationalization table given below. two types of variables are discussed in our study, dependent and independent. fdi inflow is used as the dependent variable. political stability, trade liberalization, and investment incentives are used as independent variables basically, it is the relationship between values assigned to the variables. the effect of the political stability upon the fdi is documented in this study. fdi inflow is dependent variable, and political stability, trade openness as trade liberalization, and investment incentives are our independent variables. table 3 given below describes the variables, their respective proxy, and coding used for their measurement. table 3: description of variables variables name variable code proxy/formula foreign direct investment fdi the inflow of fdi as %age of gdp political stability ps index (-2.5 weak; 2.5 strong) trade liberalization tl the ratio of export and imports to gdp investment incentives invi in the form of tariff reduction as a dummy variable 1 represents increase in tariff rates and 0 indicates decrease in tariff rates in pakistan co-integration among time series variables, the long-term relationship is established (engle and granger 2015). a combination of i(0) and i(1) are the time series, in that case, the most appropriate approach is the autoregressive distributive lag (ardl). ardl id used basically in case of small sample and is used to produces consistently long-run estimates (pesaran & shin, 1998). in establishing the long-term relationship, bounds testing procedure among variables have been developed. time-series econometric model can explain: ∆in fdi = b0 + ∑b1∆in fdit-i +∑ b2∆pst-i + ∑b3 ∆in tl t-i + ∑b4 ∆inci t-i + y1 in fdi t-i + y2pst-i + y3 in tl t-i + y4 in inci t-i + ε0 here in this equation, fdi indicates the foreign direct investment that is our dependent variable. ps represents the political stability, tl as trade liberalization; inci indicates investment incentives. these are all our dependent variables. the relationship of the short-run is described through sigma sign in those variables while longrun relationships are connoted through without sigma sign variables. findings & discussion first of all, it is most important to see that if individual time series are stationary at the point of level or the first difference so before applying the co-integration test, the order of co-integration must be identified. for this purpose, aic augmented dickey-fuller and have been applied for checking data stationery. we state the unit-root equation as follow: about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 25 ∆𝑌𝑡 = 𝛼0 + 𝛿1𝑌𝑡−1 + ∑ 𝑝 𝑗=1 𝑑𝑗 𝑌𝑡−𝑗 + 𝑡 here y is the individual time series and t is the time, ∆𝑌 shows the change in time series over time. 𝑌𝑡−𝑗 indicates the lag value of the variable, 𝛼0 and 𝛿1 indicates the estimation coefficient and 𝑡 is the residual or error term. p specifies the maximum lag length of the individual variable. table 4: checking data stationary-unit root test level first difference(*) conclusion pvalue fdi -2.595669 -3.192342 i(0) 0.0336* ps -6.437405 -2.148329 i(1) 0.0003 tl -3.050208 --6.027685 i(0) 0.0001* invi -1.260716 -6.841053 i(1) 0.0000 critical value fdi ps tl invi 1% -3.752946 -4.200056 3.769597 -3.920350 5% -2.998064 -3.175352 3.004861 -3.065585 10% -2.632752 -2.728985 2.642242 -2.673460 from the above table, it can be seen that some of the variables are stationary at the level and some are stationary at first difference. these results are taken by using intercept. those models are always best-fit that contain stationary data at the level and first difference. fdi inflow is stationary at first difference as its p-value is less than 0.05. in this case, we reject the null hypothesis. the absolute value is higher than 5% of the critical value that is -2.998064. we got such a result with the intercept. political stability (ps) in this case the p-value value is desirable that is 0.0003 less than 0.05 so we reject the null hypothesis 𝐻0which means that model is significant with that variable. the absolute value is higher than the critical value at 5% and the data is stationary at level trade liberalization (tl) has a unit root. it is more significant at the first difference with 2 lags. the absolute value is higher than 5% of the critical value and its p-value is 0.0008 less than 0.05. so we conclude that data is stationary at first difference. investment incentive (invi) is stationary at first difference. p-value is less than 0.05 which shows data is significant and we reject the null hypothesis. south asian review of business and administrative studies vol. 2, no. 1, june 2020 26 table 5: lag length determination variable lag 1 lag 2 fdi 1.615209* ps -1.290322* tl 4.768818* invi 1.478332* source: determinations of lags are by using var estimates using sbc and aic values. in the above table, fdi inflow and political stability variables are arranged with appropriate lag 2 while trade liberalization and investment incentives have lag 1. by using var estimates optimal lag values are determined that are listed in the above table. for this purpose, akaike info criterion (aic) values have been reported in the table. table 6: descriptive statistics fdi tl ps invi mean 1.257167 32.62111 -2.156911 0.333333 median 0.869000 32.90500 -2.415587 0.000000 max 3.668000 38.54000 -1.103032 1.000000 min 0.375000 25.36000 -2.810035 0.000000 s.d 1.023029 3.458058 0.556534 0.483046 ardl bound test for co-integration from here now proceed to test for co-integration. by using the bounds test for co-integration we want to know if there exists a long-run relationship among these variables. therefore, the autoregressive distributive lag (ardl) approach is the most appropriate when time series is a combination of i(0) and i(1). ardl produces consistent long-run estimates and is particularly used in the case of small samples (pesaran and shin 1998). pesaran, shin, and smith (2001) have further developed the bounds testing procedure for establishing long-term relationships among variables. after investigating and confirming the long-run relationship, the error-correction model (ecm) is applied to check the short-term fluctuations in variables and restoration of short-term shocks to long-run equilibrium. the coefficient of ect, ɵ represents the speed of adjustment by which the short-term fluctuations in variables move towards long-run equilibrium; its value should range from 0 to 1 and must be statistically negatively significant. we ran the ardl model in eviews to determine the short term and long term relationships between the fdi inflow and the variables in our model. before running the ardl model there are some pre-requisite conditions with must be fulfilled. so these conditions are first if any of the variables are stationary at 2nd difference then the ardl model cannot be run. the best condition south asian review of business and administrative studies vol. 2, no. 1, june 2020 27 for running the ardl model is some of the variables are stationary at 1st difference and some of the variables are stationary at the level and if all of the variables are stationary at 1st difference or all of the variables are stationary at level then still we can run ardl model. these conditions must be fulfilled in order to run the ardl model to get our desired results. for running the ardl model we have already concluded data stationery at the level and 1st differences and from the table, we found optimal lag for our model. we have selected one specific criterion that is the akaike info criterion (aic) for choosing optimal lag. dependent variable: fdi method: ardl date: 08/16/20 time: 16:20 sample (adjusted): 2004 2016 fixed repressors’: c number of models evaluated: 54 selected model: ardl(2, 2, 2, 2) variable coefficient std. error t-statistic prob.* fdi(-1) 0.293954 0.254060 1.157027 0.4537 fdi(-2) -0.414021 0.103845 -3.986894 0.1565 ps 1.939945 1.107206 1.752109 0.3302 ps(-1) -2.617482 0.905874 -2.889457 0.2121 ps(-2) 3.288214 0.732547 4.488741 0.1395 tl 0.100181 0.033901 2.955148 0.2077 tl(-1) 0.065880 0.063306 1.040666 0.4873 tl(-2) 0.102493 0.079660 1.286632 0.4206 invi 0.948199 0.355075 2.670419 0.2281 invi(-1) 0.718079 0.255249 2.813248 0.2174 invi(-2) 0.425341 0.472087 0.900980 0.5331 c -1.911370 2.320249 -0.823778 0.5613 r-squared 0.998144 mean dependent var 1.482462 adjusted r-squared 0.977723 s.d. dependent var 1.123781 s.e. of regression 0.167729 akaike info criterion -1.451725 sum squared resid 0.028133 schwarz criterion -0.930233 log-likelihood 21.43621 hannan-quinn criteria. -1.558915 f-statistic 48.87948 durbin-watson stat 2.885163 prob(f-statistic) 0.111150 these are the results of the short-run results of independent variables in this selection model. r south asian review of business and administrative studies vol. 2, no. 1, june 2020 28 square is high which means that the model is best fit but there is insignificance in the short-run relationship that the p-value is not less than 5%. another way of checking significance is that we conclude the absolute values of t-statistics. if t-statistics is 2 or above 2, then we can say that the variable is significant. in our model, some of the variables have t-stat absolute value 2 or more than 2 in their optimal lags. further, we will conclude the results in chapter five in detail. short-run relation and ecm the error correction model is used to show how the long term equilibrium is restored by the short term shocks or any fluctuations. ecm regression case 2: restricted constant and no trend variable coefficient std. error t-statistic prob. d(fdi(-1)) 0.414021 0.036295 11.40700 0.0499 d(ps) 1.939945 0.205715 9.430234 0.0673 d(ps(-1)) -3.288214 0.272719 -12.05715 0.0527 d(tl) 0.100181 0.011814 8.479584 0.0747 d(tl(-1)) -0.102493 0.017425 -5.881780 0.1072 d(invi) 0.948199 0.058058 16.33199 0.0389 d(invi(-1)) -0.425341 0.077986 -5.454093 0.1154 cointeq(-1)* -1.120067 0.064192 -17.44870 0.0364 r-squared 0.995890 mean dependent var 0.026308 adjusted r-squared 0.990137 s.d. dependent var 0.755302 s.e. of regression 0.075011 akaike info criterion -2.067110 sum squared resid 0.028133 schwarz criterion -1.719448 log-likelihood 21.43621 hannan-quinn criteria. -2.138570 f-statistic prob(f-statistic) 62.57940 0.000618 the important part of the result is that the value of ecm is negatively significant that is cointeq (-1)* -1.120067. in some cases, we call it adjustment terms or the adjustment coefficient and it must be negative in order to get the long term equilibrium. if this value is positive it means that our model exhibit an explosion. another main thing is that the p-value of this coefficient is 0.0364 that is less than 0.05 or 5% which means that it is statistically significant. we are happy with this result that the co-integrated coefficient is negatively significant and significant at 0.0364 less than 5%. so how we conclude the results from above that political stability and trade liberalization are south asian review of business and administrative studies vol. 2, no. 1, june 2020 29 positively related to fdi inflow and investment incentives are also positively related to the fdi inflow as a 100% increase in incentives leads to approximately 95% of the increase in fdi inflow. investment incentives encourage foreign investment in pakistan that foreign investors should get benefits from incentives like tariff reduction. long-run equilibrium relation and ardl bound testing results from here now we proceed to test for co-integration by using the bound test co-integration. we actually do this in order to find out that if there exists a long term relationship among these variables. we use coefficient diagnostics in eviews to perform the bound test. f-bounds test null hypothesis: no levels relationship test statistic value signif. i(0) i(1) asymptotic: n=1000 f-statistic 12.17829 10% 2.37 3.2 k 3 5% 2.79 3.67 2.5% 3.15 4.08 1% 3.65 4.66 these are the outcomes of the results of the ardl long-run bounds test. in the above table, i(1) show the upper level of bounds while the i(0) shows the lower level and we check mostly through the 5% of values. the main focus of attention is the f-statistics of the bound test. the null hypothesis shows that there is “no levels relationship” which simply means that there is no longrun relationship. but in our actual results, the null hypothesis is not true at all since there is a longrun relationship among the variables. here we explain the rejection criteria that we reject the null hypothesis if the value of f-statistics is higher than the i(1) bound statistics. if the value of fstatistics is lower than i(0) bound than we cannot reject the null hypothesis. if in case the value of f-stat is in between the i(1) and i(0) bound, it means the result is inconclusive and we will start our analysis all over again. in favor of alternative, our stat is higher than the i(1) bound is an indication that we have to reject the null hypothesis. hence we conclude that is in this model there’s exists a long-run relationship among the variables because we can see from the above table that the f-statistic value is 12.17 that is higher than the value of i(1) at 5% level. so we are fine with these results. diagnostic tests south asian review of business and administrative studies vol. 2, no. 1, june 2020 30 table 7: normality test the probability p-value is 0.524378 which is higher than 0.05 so we cannot reject the null hypothesis. now here a question is that what is our null hypothesis? our null is the residual is normally distributed and that is desirable. here in our diagnostic test model, we cannot reject the null hypothesis meaning that residuals are normally distributed. heteroskedasticity test: heteroskedasticity test: breusch-pagan-godfrey null hypothesis: homoskedasticity f-statistic 0.159078 prob. f(11,1) 0.9709 obs*r-squared 8.272483 prob. chi-square(11) 0.6887 scaled explained ss 0.029747 prob. chi-square(11) 1.0000 we are happy with this result as the null, in this case, is that there is heteroskedasticity in this model. we can see in the above table that the obs*r-squared, the corresponding p-value is higher than 0.05 which is 0.6887 meaning that we cannot reject the null hypothesis. in this model, fstatistic is also very high which a good sign is. so we conclude that is no heteroskedasticity in our model. serial correlation lm tests: this residual test is used to check if there is autocorrelation among the variables in the model. our null hypothesis in this case is that there is no autocorrelation. if the p-value of the value of obs*rsquare is higher than 0.05 it means that we cannot reject the null hypothesis and the result of the serial autocorrelation test is insignificant (p>0.05). south asian review of business and administrative studies vol. 2, no. 1, june 2020 31 breusch-godfrey serial correlation lm test: null hypothesis: no serial correlation at up to 2 lags f-statistic 2.093366 prob. f(2,12) 0.1660 obs*r-squared 4.655737 prob. chi-square(2) 0.0975 in the above table, the result shows that the p-value is 0.09 which is higher than 0.05 and it means there is no autocorrelation in the data. conclusion & recommendations we conclude our results that that foreign investors in pakistan consider political stability, trade liberalization, and investment incentives while making an investment decision because these are mainly work in the long-run. mainly investors are attracted by the long term beneficial conditions and these all the factors are combined to give high precision to give significant positive relations with the fdi inflow. the policymakers should not only improve the macroeconomic policy of the country but also strengthen the political conditions. the democratic government has already played a good role in stabilizing and improving the institutional quality in the country but in developing countries democratic government is not so significant as compared to military government as pakistan's fdi inflow was highest in 2007-2008. due to the immature democratic system, the cause of the gap of leadership that are duly eradicating the wave of terrorism by the military government (uddin, chowdhury, zafar, shafique, & liu, 2019) we have some important policy implications in our results. ● first, the government should focus on removing the uncertainties or macroeconomic instability in the country. ● second, pakistan should inaugurate credible trade reforms to further liberalize its trade to enhance fdi inflows. ● thirdly, pakistan needs to increase the investment incentives as tariff reduction should be the main focus so that ● fourthly, pakistan should resolve the problems related to the trade so that there’s needs to enhance fdi inflow ● finally, the law and order situation in pakistan needs to improve to attract foreign investment. ● one of the issues not discussed in this paper is the effect of the efficiency of institutions on fdi. there is also a need to explore the effects of capital account openness on fdi. further, there is a need to research the detailed industry or even firm-level, given that the fdi-trade linkage can be industry and even firm-specific. all these issues are left for future research. our study has the limitation that we are not investigating the moderating effect of the association among the fdi inflow and political stability alongside other factors. further researches can include such factors to draw a clearer image of the underlying phenomenon. references about:blank south asian review of business and administrative studies vol. 2, no. 1, june 2020 32 afridi, s., gul, s., & haider, m. 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(2014). trade liberalization and foreign direct investment in pakistan. journal of economic research, 19, 225-247. south asian review of business and administrative studies vol. 5, no. 1, june 2023 41 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas from retrospective to prospective view of xenophobia through the lens of human resource diversity management rana salman anwar, sukkur iba university pakistan khalil ahmed channa, sukkur iba university pakistan syed mir muhammad shah, sukkur iba university pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords xenophobia, human resource diversity management, prisma, systematic literature review, cross-cultural management. “xenophobia”, fear against or of foreigners is a concern for managers, organizations, social activists as well as global leaders has long been debated. however, research at the intersection of xenophobia and human resource management is lacking. to fill the lacuna, this study systematically reviewed the literature (n=157) spanning from 1945 to 2021 to dig out conceptualization of the xenophobia, different contexts, types, solutions, antecedents, theoretical foundation, and methodological debates. to screen the articles prisma approach was followed in this study. this systematic literature review uncovered many future avenues, which were not considered in the area of human resource management. these findings will help in identifying future research directions, as well as setting managerial guidelines at cross-cultural settings. the study tried to answer various research questions that may help to link past research with the future prospect to converge the research to a single point. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: rana.phdmgts19@iba-suk.edu.pk doi: 10.52461/sabas.v5i1.1888 introduction an increase in immigration around the globe has intensified the issue of xenophobic discourse, policies, and behaviors. researchers paid an extensive focus on the area of xenophobia. however, most of the work in this area comes under the umbrella of politics, economics, law, sociology, and anthropology subjects (hickel, 2014; hagensen, 2014; jager and hagensen, 2016) (figure 1). many studies highlight its importance in psychology and human resource diversity management (coetzee, 2012; zaman, 2020) (zaman et al., 2021). however, limited number of studies addressed these calls. to address this issue systematically, this study aims to perform a systematic literature review to enlighten the past, present, and future of xenophobia and human resource diversity management on the common axis. a significant amount of literature is available in the areas of xenophobia and human resource diversity management. however very few are available at the point of intersection of the two field. furthermore, due to scarcity of work at the intersection area author found no systematic. even on parallel dimensions, a good number of studies are available on both of the areas (figure 1) (cooke https://journals.iub.edu.pk/index.php/sabas mailto:rana.phdmgts19@iba-suk.edu.pk south asian review of business and administrative studies vol. 5, no. 1, june 2023 42 et al., 2020; jonsen et al., 2011; ejoke and ani, 2017; suleman et al., 2018). further, detailed research on xenophobia in the context of work environment is required to create workers' understanding of refugees and xenophobia (mujawamariya, 2013). the understanding is lacking because of the absence of comprehensive, detailed literature. and this study aims to fulfill this gap by systematically analyzing the available literature on the area. figure 1: maxqda documents graphical analysis a comprehensive and integrated research review on xenophobia under human resource diversity management is needed for the following reasons. first, from the pioneering work of (johnson, 1945) to the revolutionary work by (sharp, 2013) and (zaman et al., 2021), there is theoretical and empirical differentiation in research due to conceptual incongruence. secondly, despite publication in top-tier journals, there is a lack of conceptual clarity in human resource diversity management of xenophobia. moreover, xenophobia is a focal concept in other disciplines including psychology, politics, economics, education, law, sociology, and anthropology. yet, there is a need to interlink all interdisciplinary research. thirdly, there is a need to explore existing causes of xenophobia and its coping strategies, used or suggested by researchers. fourthly, there is a need to cross-check theories used to explain the phenomenon of xenophobia with respect to society, other stakeholders, including workers, business opportunities, organizational culture, society, and leadership. fifth, there is a dire need to cross-examine research methods used to establish the relationships and further suggest new and suitable methods. finally, the review is necessary as the trend of xenophobia research in the context of human resource diversity management has been set up since the last review of sharp (2013). to get to the rationale, the literature review focuses on answering the following questions. 1. how is xenophobia defined and understood in literature? a. in what types and forms, xenophobia exists in the world? b. what are the perceptions of xenophobia? 2. what are the leading causes behind xenophobic behavior? 3. what techniques are explained in literature to manage xenophobia? 4. where xenophobia exists in the world? past and present of xenophobia? 5. how is xenophobia defined and understood in the literature under the context of human resource diversity management? a. which strategies of human resource diversity management can cope with the xenophora? 6. which theory better explains the effect of xenophobia under the context of human resource diversity management? 7. what are the past methodological trends and opportunities for future research work? south asian review of business and administrative studies vol. 5, no. 1, june 2023 43 method we conducted a systematic literature review to pinpoint literature relevant to xenophobia and human resource diversity management at an intersection point to answer these questions. however, systematic literature review process was originally introduced in the field of medicine, but its uses spread to the every filed of research almost. and in the field of management, a large number of studies used this method (durach et al., 2017). to fulfill the objectives of the study, this research uses the preferred reporting items for the systematic reviews and meta-analyses (prisma model) process, developed and suggested by (moher et al., 2009). the model is given under the head of figure 2. figure 2: prisma analysis for this purpose, keywords with many combinations (table 1) were electronically searched in databases of science direct, taylor & francis, jstor, springer link, wily online, sage publications, emerald, google scholar, psycinfo, google books, cairn-int info, cambridge, and elsevier (table 2). secondly, google scholar profiles of prominent researchers in the field were assessed to south asian review of business and administrative studies vol. 5, no. 1, june 2023 44 find any publications discussing xenophobia not included in these databases. thirdly, the snowballing technique was used to include relevant papers "cited by" in these papers. table 1: sources used for data collection research area xenophobia diversity management search database jstor 88 51 springer 125 476 sciencedirect 0 142 taylor & francis 210 163 wiley online 210 229 sage publication 4 207 emerald 12 253 psycinfo 7 20 google books 84 234 cairn-int info 15 8 cambridge 36 29 elsevier 21 152 google scholar 2581 1964 1st search total 3663 2900 duplicate 263 0 final total 3400 2900 through above mentioned general searches, from 1918 to 2021, since the publication of the first article by (vryonis, 1918) over 102 years, 6563 papers were found in a number of journals. after a detailed analysis of papers through the process of prisma this study finally used 157 papers (since 1945 to 2021). details of the prisma process are given in figure 2. table 2: database search commands sr. no search category search command* start/end year total articles 1 diversity management diversity management 1970/2021 2930 2 diversity management diversity management (xenophobia) 1991/2021 102 3 diversity management diversity management (xenophobia, employee) 1991/2021 70 4 diversity management diversity management (xenophobia, expatriate) 2001/2021 7 5 diversity management diversity management (xenophobia, expatriate, employee) 2001/2021 7 6 xenophobia xenophobia 1918/2021 3663 7 xenophobia xenophobia (discrimination, prejudice, stereotype) 1970/2021 425 8 xenophobia xenophobia (diversity management) 1981/2021 267 9 xenophobia xenophobia (diversity management, expatriate) 1996/2021 28 10 xenophobia xenophobia (diversity management, expatriate, employee) 1996/2021 8 11 xenophobia xenophobia (diversity management, expatriate, employee, pakistan) 1996/2021 28 12 xenophobia xenophobia (human resource management) 1985/2021 570 13 xenophobia xenophobia (human resource management, pakistan) 1990/2021 102 14 human resource management (xenophobia) human resource management (xenophobia) 1992/2021 37 15 human resource management (xenophobia) human resource management (xenophobia, expatriate) 1998/2021 14 16 human resource management (xenophobia) human resource management (xenophobia, expatriate, pakistan) 1998/2021 7 17 expatriate management (xenophobia) expatriate management (xenophobia) 2008/2014 2 *words without brackets were searched in the title: words in the bracket were searched in abstracts and in keywords. south asian review of business and administrative studies vol. 5, no. 1, june 2023 45 to screen out related papers, this study used stata-16 and maxqda-2020 software. stata16 software was used to exclude the duplicate records of the fields. search commands to find out duplicates was: e.g., match columns command: xenophobia> duplicates drop authors title year, force after deleting the duplicate entries, a detailed scrutiny process was performed to find out the relevancy of papers. after screening the scope, 594 papers were identified as relevant for the next process. in this step author carefully examined the titles and abstracts of the remaining studies. maxqda-2020 software was used in this process which helps in managing codes, themes, notes, and weights for the documents. this process helps in identifying the qualified studies for the systematic literature review process. the remaining number of studies was 157. figure 1: number of publications in a year figure 4: word cloud analysis south asian review of business and administrative studies vol. 5, no. 1, june 2023 46 after carefully reading the documents, the author identifies the main codes from these articles and assigned them weightage. weightage was assigned, as per the importance of codes in literature. a word cloud analysis was performed for these codes to highlight the importance of these codes in respect to the selected documents. furthermore, an analysis was performed to check the data accuracy. to estimate, how much documents have covered the constructed codes (figure 5), frequency tests were used in maxqda software. to know the segments of the documents, codes analysis was performed through the frequency analysis in maxqda. this analysis shows the number of percentages to which studies were focusing on human resource diversity management techniques. like training, hiring, discrimination, workplace, leaders, and managers, percentages appear greater than the percentage of diversity management techniques. this also indicates the longing need for a systematic literature review. it will provide a path for future studies to align their work according to human resource diversity management. literature review q1. how is xenophobia defined and understood in literature? in a detailed review on xenophobia, zaman et al. (2021) indicates xenophobia as a new term in the english literature compared to other words such as prejudice. this phenomenon emerged very quickly on the screen of the globe. however, the world has experienced different variations in its intensity with respect to the nations and states. the rise in anti-immigrant policies provides an opportunity for the world to know more about xenophobia (zaman, 2020). the word “xenophobia” is used to elaborate the presence of hate among the natives and immigrants. this greek origin word xenophobia is a combination of “xenos” and “phobia.” xeno denotes strange, whereas phobos means fear. by combining these two words researchers concludes it as a fear of foreigner or stranger (tshishonga, 2015). however, the concept of xenophobia can be taken differently in different contexts. in some contexts, it can be used for temporary migrants or expatriates. in contrast, in other context, it can even be used for those migrants who are not new to culture because of their extended stay, but they are still not regarded as the sons of the soil (singh, 2013). xenophobia can vary as much as loathing to the contempt of strangers (ullah et al., 2020; wilson and magam, 2018). people who face xenophobia sometimes become violent in their actions, leading them to discriminate, stereotype, and prejudiced behavior in society (zaman et al., 2021). these xenophobic behaviors occur most of the time because of racial, religious, cultural, national, ethnic, or opinion differences (masenya, 2017). reservation in policies related to the foreigners may arose xenophobic feeling among natives vis-à-vis foreigners (lesetedi and modie-moroka, 2007a). according to the view of sociology, xenophobia is an aggressive behavioral orientation towards strangers in a host environment (bowling et al., 2004). this variation in the behavioral orientation of people originates in many types and forms of xenophobia. researchers elaborated them in different contexts. q2. in what types and forms, xenophobia exists in the world? afrophobia a wide range of literature enlists the nature of attacks on foreigners in south africa, which were represented as xenophobia. even the victims of these attacks demanded to name of these attacks (wilson and magam, 2018). therefore, negative behavior and violence against foreigners from other parts of africa in south africa, is now known as afrophobia (koenane, 2018). a similar concept is presented in (waiganjo, 2017) work, who says that when a violence or an attack is directed towards the african nationals, it must be reported as an afrophobia rather than xenophobia. the author further concluded that these xenophobic attacks have a strong relationship with the south asian review of business and administrative studies vol. 5, no. 1, june 2023 47 color of skin, so afrophobia is a more suitable word for these acts. like xenophobia, the intensity of this violence may vary. “buyelekhaya” (go back home) campaign was one of them in which natives of south africa blamed foreigners as a cause of crime, high unemployment rate, and sexual attacks (masenya, 2017). agoraphobia agoraphobia expresses a kind of fear when people find themselves in a situation or place where their escape becomes difficult. it occurs far from home, and people become hopeless about immediate help (casey, 1993). this fear generates the feeling of hostility among people. because of these feelings, they do not consider their host place as an open place (dienga, 2011). agoraphobia sometimes badly impacts the mental health of individuals or groups, which requires a proper pharmacological or nonpharmacological treatment for the victims (levine et al., 2007). negrophobia negrophobia represents the fear of “negros” or “black”. negrophobia and afrobhobia are synonymous words in research (dienga, 2011). researchers have used these terms to report those xenophobic attacks which were directed towards the africans (everatt, 2011). it also varies in intensity, such as in the 2015 xenophobic violence, hundreds of those shops were looted which were owned by the african immigrants (ogunnubi and amusan, 2018). homophobia unlike the other kinds of xenophobia, this phobia belongs to the homosexual person. it is a kind of hate for the people who are bisexual, lesbian or gay (morozov, 2017). it is not only restricted to bisexual people. but people who ever have lived with bisexual people or hiv patients also face discrimination and homophobic behavior (crush and tawodzera, 2014). research on human rights indicates a high number of resistances for these people at the workplace. according to the research, either many people demanded the death penalty for homosexual people, or they did not agree to work with them (crush, 2001). therefore, homophobia also varies in its intensity. islamophobia in post 9/11 era, the status of muslims became questionable in many countries, especially in the west part of the globe. associating terror acts with muslims become common in this era (shabbir et al., 2020). discrimination, stereotyping, and prejudice are common practices against muslims in this era (waller, 2020). with the passage of time now this religious discrimination even becomes more ethnic and nationality-based xenophobia (kingsbury, 2020). eco-xenophobia xenophobic thoughts are not only limited to humans. humans have these thoughts and behaviors for non-human species too. classifying non-human species such as birds and plants falls under the category of eco-xenophobia (dinat et al., 2019). in literature, the great-tailed grackle bird is presented foreigner bird who faced eco-xenophobic behavior in south africa (dinat et al., 2019; echeverri et al., 2019). because of this behavior, people sometimes start rejecting foreigner nonhuman things in their countries. anglophobia another kind of phobia that provides a base to reject foreigners is anglophobia. it is a fear of english people or whites (dienga, 2011). if afrophobia and nagrophobia are associated with the black people, it is associated with the white people (ogunnubi and amusan, 2018). because it is another kind of phobia that is associated with the color or origin of people, as well as language. so, the intensity of this phobia also varies in different contexts. south asian review of business and administrative studies vol. 5, no. 1, june 2023 48 reverse xenophobia in the domain of xenophobia, many studies have focused on host country nationals that how they perceive about foreigners (ullah et al., 2020; suleman et al., 2018). but it is a two-way process. immigrants are the one who travels to another country, and they have perceptions too about the host country nationals. therefore, a kind of xenophobia in which we report foreigners' perceptions about host country nationals is known as reverse xenophobia (lesetedi and modie-moroka, 2007b). reverse xenophobia is more about “others”, and cross-border experiences (radia, 2013). this phenomenon helps in explaining its two-way impact on people interacting in a multi-cultural environment. pandemic xenophobia in reviewing the literature, a new kind of xenophobia’s type emerged, which is more related to the situations of pandemics. people associates some disease’s with a specific ethnic groups, and treat them with different discriminatory and prejudice behaviors (sylvia chou and gaysynsky, 2021). in recent times people from asian backgrounds not only faced discriminatory behavior, but they also faced many xenophobic attacks (white, 2020). this xenophobic behavior not only comes from a single nation but from all over the globe. like for corona, twitter was trending with “#chinesevirus” statements (sylvia chou and gaysynsky, 2021). furthermore, in dealing with pandemic cause nominated groups or individuals, xenophobic people also associate their past experiences and images of nations with the situations (jillson, 2020). according to the jillson (2020), costa rica’s nationals were not only xenophobic in this situation, but they showed their anger towards the government because they were not stopping people to come in their country. several other studies have also reported xenophobic issues emergence at workplaces because of covid-19 (essanoussi, 2022) new definition of xenophobia from the review of literature on defining xenophobia, we concluded a comprehensive definition of it. “xenophobia is a fear of stranger or foreigner, which varies across the perceptions of people, and can be based on nationality, skin color, language, experience, association of things, and religion.” q3. what are the perceptions of xenophobia? researchers have presented three main perceptions of xenophobia. antipathy an individual or group who considers xenophobia as unacceptable behavior and demands that there should be a cure for these acts comes under the head of antipathy (coetzee, 2012). these people believe in immigrants’ rights, proper legislation, clear and acceptable national policies, and in the development of clear counter-acts and laws for xenophobic behaviors (sharp, 2013). empathy these people acknowledge the reasons behind xenophobic attacks, such as unemployment and economic conditions. these people found xenophobic people's behaviors understandable, and demands for foreigners returns (coetzee, 2012). although some people dislike empathy (waller, 2020). but people support this behavior due to the long-term bad conditions or policies of their government or state (mati, 2011). apathy those people are neither antipathetic nor empathetic. their views get influenced by many pull and push factors. they neglect xenophobia either entirely or somewhat in intensity, and they get confused about the social problems of immigrants and host nationals (coetzee, 2012). according south asian review of business and administrative studies vol. 5, no. 1, june 2023 49 to the individuals, media plays a vital role in the construction of apathy perception. and they asked the media to work on a commonly shared problem so that the development can occur (humpage, 2020). this confusing state of xenophobia perception supports and neglects xenophobia at the same time. q4-i. what are the leading causes behind xenophobic behavior? many researchers present several factors that cause xenophobia (okun et al., 2020; zaman et al., 2021; tshishonga, 2015; hagensen, 2014). in a context-specific analysis of xenophobic behavior causes (tjemsland, 2017) explains that most causes remain the same across the different contexts. so, this study will present all the possible causes of xenophobia in a table form (table 3), which will help this study cover as many causes as possible. studies have found that high unemployment rates in a country can cause individuals to blame foreigners for their unemployment, leading to xenophobic behavior (coetzee, 2012; parsley, 2002; di paola, 2012; kang, 2020). similarly, nationals of countries with poor economic conditions often express xenophobic behavior towards nationals of other countries, perceiving them as a burden on their economies (coetzee, 2012; sharp, 2013; sebola, 2017; sichone, 2006). additionally, governance deficiencies, such as the absence of law and implementation issues, can provide opportunities for people to act according to their will, sometimes leading to xenophobic behavior (colletta, 2015; coetzee, 2012; yıldız et al., 2023). when host nationals perceive foreigners as a reason for an increase in crime, they become xenophobic towards them (nyamnjoh, 2014; dinat et al., 2019; mpofu, 2018; mafukata, 2021). moreover, false reporting by media has been found to construct negative images of foreign nationals, leading individuals to become xenophobic (sharp, 2013; zaman et al., 2021). people with lower levels of education also tend to think negatively about foreigners, as they lack information and knowledge (waiganjo, 2017; waiganjo, 2018). furthermore, issues presented in the system of social justice can generate xenophobic thoughts, as individuals perceive it as a breadand-butter issue (chimbga and meier, 2014; chimbga, 2013). host country nationals may also become jealous of foreigners who own well-reputed businesses or compete with them in business, leading to xenophobic behavior (chimbga, 2013; muchiri, 2016). additionally, when people compare the resources available to foreign nationals and host nationals, they may start competing for resources such as health services, houses, and taxes, which can sometimes lead to xenophobia (mohamed, 2011; akinola et al., 2018). the belief among nationals that foreigners are living on their resources and that the government is providing free opportunities to them also causes xenophobic behavior (fomina, 2017; dahlberg and thapar-björkert, 2023). furthermore, people who are not aware of their country's immigration laws may act xenophobically towards nationals of other countries (muchiri, 2016). when a country fails to provide basic human rights to migrants, it creates an opportunity for people to perform xenophobic behavior (muchiri, 2016; hewitt et al., 2020). personal anger, arising from poverty or other personal factors, can create negative thoughts about foreigners, and a dislike or rejection of strangers may lead to xenophobic attitudes (okun et al., 2020). leadership also plays a vital role in generating acceptability for each other, and hostile or unethical statements by leaders can awaken xenophobia among nations (okun et al., 2020; kingsbury, 2020). furthermore, government inability to deal with refugees and illegal aliens in a country creates curiosity among nationals, and this uncertainty of a proper mechanism allows them to take matters into their own hands (mohamed, 2011). extreme patriotism and emotional involvement towards a country's politics and overall situation can also contribute to xenophobic attitudes and behavior (mohamed, 2011). in conclusion, there are a multitude of factors that can south asian review of business and administrative studies vol. 5, no. 1, june 2023 50 contribute to the development of xenophobic attitudes and behavior towards foreign nationals, including economic factors, social justice issues, media portrayals, lack of education and knowledge, personal beliefs and emotions, and political leadership. table 3: reasons of xenophobia from literature q4-ii. what techniques are explained in literature to manage xenophobia? while reporting causes of xenophobia, researchers present many coping strategies in literature (waiganjo, 2018; adeola, 2015). to report them, this study enlists them in a table format (table 4). xenophobia is a severe problem that affects people from all walks of life and cultures. various managerial strategies have been developed to handle this issue. one effective strategy, according to adeola (2015), is the role of unions in fostering peace, cooperation, the sanctity of life, and respect for human rights. unions can foster a positive culture among different states by establishing an assembly of heads of state, union commissioners, human rights commissions, and economic and social councils. another method for dealing with xenophobia is to construct a peace and security architecture at the continental level, which ensures stability in laws and practices and aids in the removal of curiosity (adeola, 2015). a centralized mechanism for early identification of xenophobic conduct should be established, with advanced measures implemented by the government (muchiri, 2016; zaman, 2020). prioritization and the use of coping methods can assist officials in reducing xenophobic behavior (muchiri, 2016). another major concern is the lack of basic and written immigrant rights provisions. making certain that all rights are granted on legitimate grounds would aid in dealing with xenophobia (muchiri, 2016; dorter and damani, 2022). countries have yet to build proper and well-defined immigration processes. they can reduce xenophobia by developing an up-to-date system (muchiri, 2016; ullah et al., 2020). local authorities should be educated on their responsibilities and accountability to immigration. as a result, their followers will be influenced as well (staeheli and nagel, 2013; muchiri, 2016; mudau and khanare, 2021). authorities should respect and incorporate a section on foreigner's rights in the curriculum preparation phase. education on these topics should not be limited to students; institutions should consider how they can educate families on xenophobia as well (akinola, 2018; peucker, 2010; kang’ethe and wotshela, 2016). embracing ubuntuism at the national level can lead to concord and help cross-cultural participants deal with xenophobia (muchiri, 2016; masenya, 2017). many policymakers engage in xenophobic conduct on occasion. as a result, good representation at this time can help to alleviate the issue of xenophobia (pugh, 2014). south asian review of business and administrative studies vol. 5, no. 1, june 2023 51 unbalanced migration causes several problems for states. these concerns can be addressed with a robust migration management system and the involvement of civic society in these topics (pugh, 2014; crush and pendleton, 2004). governments are responsible for monitoring anti-immigrant and xenophobic campaigns. restricting these campaigns at the outset will aid in the reduction of xenophobia (kang’ethe and wotshela, 2016). another key component in minimizing xenophobia is properly conducting checks on irresponsive utterances about foreigners (kang’ethe and wotshela, 2016). economic policies that are shared can aid in threat reduction. offering work to host nationals in enterprises, for example, will assure security and develop goodwill (waiganjo, 2017; waiganjo, 2018). creating chances for new businesses will result in a more healthy atmosphere and cultural interactions. it will foster understanding and reduce problems (waiganjo, 2017; waiganjo, 2018). aiding in trauma recovery can also help with xenophobia (waiganjo, 2018). people from the same cultural background as the host nation's culture become more resilient and can deal with xenophobic situations more readily, which aids in trauma recovery (waiganjo, 2017). xenophobia is a social problem that impacts immigrants in a variety of ways. to counteract the impacts of xenophobia, numerous measures can be used. psychological withdrawal or identity escape is one of the tactics. according to mujawamariya (2013), some dominating groups may conceal their identities in order to avoid xenophobic violence. they may also associate with lower level groups in order to avoid being targeted. this method assists them in concealing their identities from others. living in overcrowded regions is another option that might assist immigrants reduce their living costs and dangers. this can also shield them from the negative impacts of xenophobia. according to mujawamariya (2013), having a residence and a job in a densely populated area can be advantageous in this regard. immigrant integration is another strategy that authorities can use to combat xenophobia. authorities, according to yakushko (2018b), can help to reduce xenophobia by integrating immigrants into national institutions, cultures, laws, practices, and development. this can be accomplished through a variety of techniques, including language classes, job possibilities, and cultural exchange programs. encouraging the use of cultural exchange programs, student diversity initiatives, and foreign scholarship is another great strategy to help a country flourish. this can help pupils become more tolerant of different nationalities and cultures by exposing them to them. according to kang’ethe and wotshela (2016), these activities can help to build a more mature and accepting community. table 4: xenophobic management techniques (general) south asian review of business and administrative studies vol. 5, no. 1, june 2023 52 q5. where xenophobia exists in the world? past and present of xenophobia? the literature presents many incidents where people have faced xenophobic behavior in different countries. in this section, we will present studies that claim which countries nationals have xenophobic attitudes towards other nationals or outer group members (table 5). table 5: literature claims about xenophobia presence in countries q6. how is xenophobia defined and understood in the literature under the context of human resource diversity management? research on xenophobia in human resource diversity management is in its initial stage (zaman et al., 2021). although researchers are indicating its need for several years (coetzee, 2012; syed and pio, 2013; mujawamariya, 2013), but a very little emphasis has been paid to these calls. xenophobia has emerged as a one of the top five political factors, which affects the success of a multi-national project or business (zaman, 2020). negligence of research towards this issue may cause several consequences at transnational projects. to overcome the issues, this research has aimed to study this phenomenon in a transnational project. q6-i. which strategies of human resource diversity management can cope with the xenophobia? some of the studies have investigated this issue with different coping strategies. as kang’ethe and wotshela (2016), in their study, indicates that educating immigrants, their families, and their kids; and preparing modules that can help them in cross-cultural learning and adjustment are one of the instrument for coping with xenophobia. they emphasized the cultural training need in crosscultural settings. training is not enough in these contexts, but retraining, human resource south asian review of business and administrative studies vol. 5, no. 1, june 2023 53 development, performance measurement, accountability are the elements that can help in sustaining a good culture in an organization (umeh, 2018). in a qualitative nature of study, (zaman et al., 2021) explored some factors which can help in coping with xenophobia. the factors which they have explored are: cross-cultural training & development, flexible pay system, international staffing methods, flexible work hours, work design, work-life balance, equal employment opportunity, image building, organizational support, performance management system, leadership, and task innovation. whereas another study conducted by zaman (2020) indicates that transformational leadership and high-performance work practices are the strategies that can moderate the effect of xenophobia in the transnational workplace. but the phenomenon is still under exploration and requires proper consideration. q6-ii. which theory better explains the effect of xenophobia under the context of human resource diversity management? to work with the issues of xenophobia, researchers used many theories, which are enlisted in table 6. list of theories are presented with references and frequencies. scapegoating theory and social identity theories are the most frequently used theories. most of the theories which have been used in literature were related to the economy, politics, anthropology, and reactive behaviors. while choosing a theory for studying xenophobic behavior in the context of human resource diversity management, this study has carefully analyzed available theories. such as in the analyzation process, this study has found that scapegoating theory states that, when people start blaming others for their own issues, it became a xenophobic behavior (akinola, 2018; coetzee, 2012; masikane, 2017; mujawamariya, 2013; umeh, 2018). but this theory studies and explains reactive and blaming behaviors of individuals. economic competition theory (gordon, 2017) and economic theory (coetzee, 2012; dienga, 2011) explain individuals' behavior towards concern for available resources in their countries. while frustration aggression theory (coetzee, 2012; dienga, 2011; gordon, 2017) also helps in studying reactive behaviors of people. people react aggressively when they face hurdles in the way of achieving goals. social identity theory explains the behavior of both nationals, which will help in understanding all presented types of xenophobia, such as reverse xenophobia. exploring xenophobia for both types of nationals (native and foreigner) at transnational projects is more important. because members of a dominant group in the international environment occasionally express xenophobic attitudes, they may economically profit from the follower group by making them low-paid workers (quillian, 1995). explanations of social psychology give particular importance to social identity, social position, social group membership, and social self-categorization for xenophobia (ekehammar and akrami, 2007). henry tajfel’s social identity theory elaborates xenophobia as a response to an individual’s classification of the world from which they belong. social identity is considered as a part of individuals self-concept. and it comes from their affiliation with a group. it is a behavior of a favoritism for group from which an individual is affiliated, because of the conceptualization about self-identity relation with group (tajfel, 2010). self-esteem is created by the thinking of superiority of ‘own self’ due to belongingness, people, devaluate out-group and its members (hinton, 2003). social identity theory argues that memberships may differ in salience in time and as a function of the variability of social institutions (tajfel., 1982). hjerm (2009) contends that our national identity describes who belongs to our own group and who do not, to delineate the nation's boundaries and so links social identity theory to national identity. blumer’s group position theory (1958) tells about the suppositions associated with the socialsouth asian review of business and administrative studies vol. 5, no. 1, june 2023 54 psychological descriptions to prejudice and to stereotype. conferring to blumer it originates from empirical and communal developed rulings about the positions of individuals in the social hierarchy that in-group members should rightfully occupy in comparison to associates of an outgroup. as per the core logic of xenophobia, the image of out-group members is subjective in ingroup members' minds and vis-à-vis for in-group members (bobo and hutchings, 1996). table 6: theories used in past literature south asian review of business and administrative studies vol. 5, no. 1, june 2023 55 q7. what are the past methodological trends and opportunities for future research work? a review of available studies indicates that most of the studies have used a qualitative approach to explore the phenomenon. such as (sharp, 2013) and (zaman et al., 2021) studies investigated xenophobia regarding human resource diversity management. they acquire the qualitative method to explore the phenomenon. but the studies were limited in their scope. to further explore the phenomenon, future studies may use grounded theory methodological approach for exploring the phenomenon in depth. studies that acquired the quantitative methods have emphasized more on measuring the impact of xenophobia on the success of businesses (e.g. (zaman, 2020). he investigates the impact of human resource diversity management strategies moderating impact on businesses' success in the presence of xenophobia. however, dimensions of human resource diversity management that he used in his study did not represent all human resource diversity management strategies. in response to the research calls, his work was not enough in human resource diversity management. so, future studies may investigate the impact of human resource diversity management explored strategies on xenophobia at the trans-national projects. conclusion in an attempt to bridge the gap between human resource diversity management, and xenophobia this research has systematically reviewed the available literature. this helps in identifying different forms of xenophobia, such as: afrophobia, negrophobia, agoraphobia, anglophobia, homophobia, islamophobia, eco-xenophobia, reverse xenophobia, and pandemic xenophobia. in reviewing the literature, three different types of perceptions regarding xenophobia have been recorded. this helps in understanding that how people of different nationals at transnationals workplace perceive xenophobia. with a comprehensive list of wider-level xenophobia’s problems and solutions, this research attempts to provide a clearer future direction. furthermore, this research has clarified a way to bridge the gap between xenophobia and human resource diversity management practices. this research will help others to find directions for future research. in contrast, future research on the area will help in making the transnational workplace more competitive and reliable. future options china–pakistan economic corridor (cpec) has attracted approximately usd 62 billion of chinese investment in pakistan (baldwin, 2017; siddiqui, 2017), which is expected to reach usd 100 billion by 2030 (hadi et al., 2018). cpec also offers a strong potential to bring many expatriates and international interests to pakistan (makhdoom et al., 2018). because of its proven global significance, many academics are focused on developing issues that are creating difficulties for cpec's future and investigating methods to solve them early. cpec is an essential component of china's belt and road initiative (bri), which envisions a contemporary twenty-first-century silk route. this mega-construction project's cost of about 46 usd billion is expected to last almost 16 years (2014–2030), depending on its completion and maturity. this megaproject can only yield fruit if xenophobic attitudes against foreign investors and employees are eradicated (qadir and manan, 2014), and cpec is protected from the emerging threat of xenophobia [6]. chinese and pakistani people were threatened and attacked for reasons that could be traced to a migration policy fault and the threat of job loss or resource control (fayomi et al., 2015). the china–pakistan economic corridor (cpec) has lately boosted the flow of chinese workers to pakistan, resulting in violent xenophobic events in different cpec-related projects. to address xenophobic motives, the institutional study of ground realities is required; therefore, creating an inclusive and encouraging environment of equality, peace, diversity, and inclusion may be a helpful approach to address “diverse ethnic” workforce issues (al ariss et al., 2014; kelan and wratil, 2018). moreover, it is suggested by anwar et al. (2021) that using grounded theory and case study method will be most effective way to explore the paths to the solutions in this kind of study. therefore, south asian review of business and administrative studies vol. 5, no. 1, june 2023 56 this option can be used to study the area in international environment for multiple avenues (see table 7). table 7: future research directions references adeola r. (2015) preventing xenophobia in africa: what must the african union do? african human mobility review 1: 253-272. akinola ao. (2018) the scourge of xenophobia: from botswana to zambia. in: akinola ao (ed) the political economy of xenophobia in africa. cham: springer international publishing, 23-35. akinola ao, akinola and klimowich. (2018) the political economy of xenophobia in africa: springer. al ariss a, cascio wf and paauwe j. (2014) special issue: talent management. talent management: current theories and future research directions %j 2 journal of world business: 173 179. alvarez j. 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(2021) human resource diversity management (hrdm) practices as a coping mechanism for xenophobia at transnational workplace: a case of a multi-billion-dollar economic corridor. cogent business & management 8. south asian review of business and administrative studies vol. 3, no. 1, june 2021 55 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.1, june 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas the impact of green human resource management on environment performance: a roadmap towards sustainable development in hotel industry amir rafique, assistant professor, comsats university islamabad, pakistan sheryar shahid, research scholar, comsats university islamabad, pakistan muhammad umer quddoos, assistant professor, department of commerce, bahauddin zakariya university, pakistan article details abstract history revised format: may 2021 available online: june 2021 keywords green human resource management, employees’ eco-friendly behavior, employees’ organizational commitment, hotel environmental performance, sustainability the purpose of this study is to analyze the impact of green human resource management (ghrm) upon the hotel’s environmental performance (hep) in view of the global call for sustainability. the study was conducted by sampling the employees from different hotels of twin cities of rawalpindi and islamabad. spss and pls were used for data analysis. the findings show that ghrm has a positive impact on hep, but the direct relationship between employees’ organizational commitment (eoc) and hep is negative, while eoc plays a negative role in the relationship between ghrm and hep. the sequential mediation shows that the eoc and employees’ eco-friendly behavior (eeb) positively mediate the relationship between ghrm and hep. this research shows that it would be helpful for the employees to understand the effects of green human resource strategies and practices for improvement in the hotel environment and thereby leading towards sustainable performance. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: umerattari@bzu.edu.pk doi: https://doi.org/10.52461/sabas.v3i1.468 introduction global warming is becoming one of the major issues of many governments and organizations, particularly corporations working in areas that have a poor impact on the environment and natural resources, such as construction companies, oil exploration companies and hotels / resorts. thus, many agencies have emphasized the development of strategies that highlight the green factors of active environmental management. in the hospitality sector, using environmental practices in human resource administration has been seen as one of the major goals of organizations to limit wastes, save costs and beautify employees' environmental awareness and green popularity. the important issue of the past decades about the hotel environment is that how waste should be consumed and how to improve the employees' commitment to the environment. top management should develop a strategy to deal with the issues related to waste and water that affect the environment. it is traditionally an hr responsibility to make policies that can enhance the https://journals.iub.edu.pk/index.php/sabas mailto:umerattari@bzu.edu.pk https://doi.org/10.52461/sabas.v3i1.468 south asian review of business and administrative studies vol. 3, no. 1, june 2021 56 organizational commitment of the workers. the ghrm program aims to create awareness to employees and consumers to reduce the harmful effect of the environment. employees establish higher level of organizational commitment, when they are emotionally attached to the organization which is engaged in the ghrm program. the human resource management, environmental and hotel management are interlinked and are relevant to the hospitality industry. environmental management is a hot topic these days (renwick, redman, and maguire, 2013), and when environmental management planning is combined with human resource management, the result is green human resource management (ghrm) (renwick, redman, and maguire, 2013). employees should also take part in the organization's environmental citizenship conduct (robertson and barling, 2017), where this behavior improves organizational commitment towards the environment (de groot and steg, 2010). in hospitality sector, planning and management of the green activities are very much important as the sector is considered to be the major contributor of carbon emission, and this will not only upgrade the ecology but also improves the organization performance (koseoglu, rahimi, okumus, & liu, 2016). literature review a few researchers have focused on hrm with environment management, so naming it as "green human resource management" (renwick, redman, and maguire, 2013). this study also studies hrm in connection with environment management (ghrm). there are four stages of ghrm: environment planning (constructing ecological vision and objectives), train human resource to share their views on ecological vision and objectives, execution of the ecological planning by the employees, assess execution of the ecological planning by the employees. daily and huang (2001) proposed a model of hrm which is very effective in environment management. individuals can only develop constructive ideas in a social settings (hogg and abrams, 1990; kim, kim, choi, and phetvaroon, 2019). the ideas are further improved in individuals with their engagement in social participation (ashforth and mael, 1989; turner, 1999). the workers must be trained to work in a social setting to perform certain activities related to the society (ashforth and mael, 1989; peterson and seligman, 2004). the workers who have an impression of hr commitment to certain activities show their obligations towards those activities (brammer, he, and mellahi, 2015; turker, 2009). the workers positive behavior shows improved commitment towards the desired objectives (lin et al., 2013). the social character theory hypothesizes various levels of workers’ commitment towards their obligations (o’reilly & chatman, 1986; shen and benson, 2016). the social identity theory is a famous social psychological theory that tries to explain intergroup conflicts, people's choice of groups, and the influence of groups on people's views (hogg and abrams, 1990; ashforth and mael, 1989). theoretical background and hypotheses development the literature shows that ghrm is important to improve environmental performance in the hotel sector, where the employees organizational commitment (eoc) and employees environmental behavior also play the pivotal role in the relationship between ghrm and hotel environmental performance (hep). figure 1: hypotheses development ghr m hep eeb eoc south asian review of business and administrative studies vol. 3, no. 1, june 2021 57 we created the following hypothesis for this investigation based on the previous literature review. the ghrm and hep have the most important link. hypothesis 1: ghrm significantly influences hep. it is argued that the hrm practices impact employees behavior (kim et al., 2019). gould-williams and davies (2005) found that human resource practices improve employees’ commitment and behavior to achieve the desired objectives. hrm plays a key role in improving the skills and controlling the actions of the employees (bratton and gold, 2017). hrm can play a significant role in improving the hotel environment performance by affecting employees organizational commitment and employees eco-friendly behavior (kim et al., 2019). so, it is concluded that ghrm is the most important aspect in improving the hotel environment performance by influencing the behavior of employees. podsakoff and mackenzie (1997) found that employees’ organization commitment is also required to achieve the desired objectives of the organization. ghrm effects the eoc to achieve the desired objective of hep. hypothesis 2: ghrm significantly influences eoc. hrm practices affect employees behavior (homan, van knippenberg, van kleef, and de dreu, 2007) to motivate them for some desired organizational objectives (xu et al., 2004). ghrm policies improve the environmental concern of the employees (kollmuss and agyeman, 2002). eco-friendly behavior centers around explicit practices related with efficient utilization of resources, minimum water use, and decrease in wastage. so, it is concluded that ghrm improves the employees’ eco-friendly behavior (eeb). hypothesis 3: ghrm significantly influences eeb. employees’ behavior is required to achieve the desired objectives of an organization (carmeli, gilat, and weisberg, 2006). eeb plays a significant role in improving the hotel environmental performance (hep) of any organization in the hotel industry. hypothesis 4: eeb significantly influences hep. commitment plays major role in improving the performance of an organization. employees’ commitment to improve the environment of a hotel will result in increased hotel environment performance (hep). hypothesis 5: eoc significantly influences hep. eoc also mediates the relationship between ghrm and eeb because the behavior cannot be changed merely by the hrm practices but also needs a great deal of commitment by the employees. hypothesis 6: eoc mediates the relationship between ghrm and eeb. employee’s organizational commitment plays an important role in organization. so, they play a vital role in improving environmental performance if properly directed by ghrm practices. hypothesis 7: eoc mediates the relationship between ghrm and hep. south asian review of business and administrative studies vol. 3, no. 1, june 2021 58 ghrm improves employees organizational commitment (eoc), which is only fruitful in achieving the desired results of hotel environmental performance (hep) if improves the employees’ eco-friendly behavior (eeb). eoc and eeb both have a direct and indirect impact on hep. in sequential mediation, we'll look at how various mediators affect hep as a result of ghrm policies being implemented. hypothesis 8: eoc and eeb sequentially mediate the relationship between ghrm and hep. data and methodology in this section, we discuss data collection, measurement of variables and instrument development. the information is gathered by a questionnaire from the top management of various hotels' human resource departments. the majority of the questions concern hotel training programmes aimed at environmental conservation. we were able to determine whether or not the hotels have adopted ghrm practises on their premises by asking the questions. each item of the ghrm, eco, eeb, and hep is measured using a 5-point likert scale ranging from "strongly disagree (1)" to "strongly agree (5)" on the questionnaire. the purposive sampling is used to collect the data. in the study we use different analysis tools and techniques. first of all, we checked the reliability and validity of the instrument. pls-sem are used for further analysis. data analysis and results we collected 200 responses from different hotels in islamabad and rawalpindi and conducted different test to check the data validity and reliability. we used the researchers' recommended approaches due to the small sample size compared to the amount of measurement items. reliability and validity table 1 shows that all cronbach's alpha and ave values are greater than the cutoff values of 0.7 and 0.5, respectively. this shows the reliability and validity of the data collection instrument. table 1: reliability and validity cronbach’s alpha rho-a composite reliability average variance extracted (ave) eeb 0.880 0.882 0.907 0.582 eoc 0.896 0.904 0.918 0.616 ghrm 0.872 0.875 0.904 0.610 hep 0.900 0.905 0.923 0.666 direct effects the table 2 shows the direct effects between the variables. we accept the hypothesis, h1, that green human resource management has a positive and significant impact on eoc, with a beta value of (0.647), where the t value is (9.256) and the p value is (0.000). with a beta value of (0.504) and a t value of (5.377) and a p value of (0.000), ghrm likewise demonstrates a positive link with eeb, thus we accept the hypothesis, h2. the findings reveal that eeb has a positive link with hep, with a beta value of (0.376), a t value of (3.312), and a p value of (0.001), so we accept hypothesis h3. the table reveals a positive link between ghrm and hep with a beta value of (0.368), where the t value is (3.083) and the p value is (0.002), so we accept the hypothesis, h4. the data also demonstrate that eoc has a positive association with hep, with a beta value of (0.002), a t value of (0.032), and a p value of (0.974), indicating that we reject hypothesis h5. past studies proved that ghrm contributes to eoc. chae, yen, and sheu (2005) found that ghrm affects hep. likewise, many researchers found that eeb was a strong determinant of hep (demir, 2008; herrera, 2010). south asian review of business and administrative studies vol. 3, no. 1, june 2021 59 table 2: direct effects mediation effects employee organizational commitment (eoc) mediates the association between ghrm and eeb, as shown in table 3, with a beta value of 0.172, a t value of (2.73), and a p value of (0.007), respectively, thus we accept the hypothesis, h6. the results of the mediation effect of eoc between ghrm and hep show that the beta value is (-0.001), while the t and p values are (0.031) and (0.975), respectively, indicating that the hypothesis, h7, is rejected. the beta value for the sequential mediation of eoc and eeb between ghrm and hep is (0.065), while the t and p values are (2.300) and (0.002), respectively, so we accept the hypothesis, h8. table 3: indirect effects variable original sample sample mean stdv t value p value ghrm>eoc>eeb 0.172 0.177 0.064 2.703 0.007 ghrm>eoc>hep -0.001 0.002 0.043 0.031 0.975 ghrm>eoc>eeb>hep 0.065 0.064 0.028 2.300 0.002 conclusion and recommendations the term green hrm is a buzzword nowadays and its importance has increased over time. this is because of the reason that the attention of the governments and businesses towards environmental issues have also increased manifold. ghrm has become an interesting topic of current research world. green human resource management not only increases awareness about environmental issues, but also improves social image of the organization. the study's findings suggest that implementing green human resource management policies and practises has a beneficial impact on hotel environmental performance by increasing employee commitment and encouraging eco-friendly behaviour. green human resource management policies and practises, in some way, contribute to the hotel's eco-friendly environment. this study focuses mainly on ghrm, where dutta and lanvin (2012) state that the ghrm integrates two key components, hr practices with the environmental concern. the main goal of ghrm in hotel sector is to make employees aware of the complexity of the related environmental issues and environment of the hotel; for example, which activities are required, how they work and how these can be helpful for the environment. by participating in the environmentally friendly programme, the action truly convinces the employees and instils a sense of pride in them. ghrm motivates the workers to comprehend and improve green culture in an organization. the environmental performance can be improved by the hr policies like recruitment, selection, training, and advancement of the human capital of the organization with more concern about the original sample (o) sample mean (m) standard deviation (stdev) t-statistics (|o/stdev|) p values ghrm -> eoc 0.647 0.646 0.070 9.256 0.000 ghrm -> eeb 0.504 0.498 0.094 5.377 0.000 eeb -> hep 0.376 0.375 0.114 3.312 0.001 ghrm -> hep 0.368 0.362 0.119 3.083 0.002 eoc -> hep -0.002 0.003 0.065 0.032 0.974 south asian review of business and administrative studies vol. 3, no. 1, june 2021 60 environment (dutta & lanvin, 2012). an organization's hr office can play a significant job in making a culture of conduct for employees (harmon-jones, harmon-jones, and price, 2013). hr policies and procedures can do a significant job in the implementation and effectiveness of the green hr strategy (renwick, redman, and maguire, 2008). the study suggests that employees’ appraisal should give a proper weight on the environmental understanding of the employees and commitment to improve the environment. the job descriptions must also include the activities related to environmental concern. the hr policies should enhance the commitment and improve the behavior of the employees which will result in increased environmental performance. the hr training 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(2004, may 13). crystal structures of kv channel proteins and uses thereof. google patents. south asian review of business and administrative studies vol. 3, no. 1, june 2021 62 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 99 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas product motive in insurance waqf transaction: is it allowed? fauzia ulirrahmi, universitas islam negeri surakarta, indonesia haq muhammad hamka habibie, universitas islam negeri surakarta, indonesia article details abstract history revised format: nov 2021 available online: dec 2021 keywords insurance, waqf, products motive, islamic law, one of the innovations on waqf is insurance waqf. this paper studies on the fully product motive (the type of insurance waqf with full financing when waqf is used as the main purpose and intention in conducting transactions). due to the requirement that waqf property must remain perpetual, the insurance waqf contract in relation to the fully product can be considered as vague. fully product is when the waqif makes waqf the core goal in carrying out insurance. these consequences arise if one day the insurance waqf participant cannot fulfill his obligation to pay the premium so that the dependent status becomes lapsed. in addition, there are several shariah provisions that need to be studied related to the fully product motive. this research will examine the fully product motive in insurance waqf in indonesia and its conformity with shariah principles. the findings show that the motive for the fully product is not in accordance with several sharia provisions because there is the potentials for waqf assets to be lost if the waqif cannot fulfil the obligation to pay the premium properly and in insurance waqf, the waqif does not have the authority to freely determine the contents of the contract agreement because the insurance agreement is attached to the insurer’s requirements (adhesion. moreover, the investment benefits that are distributed must not violate wills in islamic inheritance law i.e distribution of not more than 1/3 except with the approval of the heirs. it is recommended that if an insurance participant wants to participate in an insurance waqf activity, his or her intention to have insurance must be placed at the beginning to fulfill the principle of insurable interest which must always be prioritized for all types of insurance. in addition, any endowment of insurance or investment benefits must be shariah compliant. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: fauzia.ulirrahmi@iain-surakarta.ac.id doi: https://doi.org/10.52461/sabas.v3i2.737 introduction as a country with a muslim majority in the world, indonesian interest in shariah insurance is very large. this is in accordance with data from the financial services authority (ojk) which states https://journals.iub.edu.pk/index.php/sabas mailto:fauzia.ulirrahmi@iain-surakarta.ac.id https://doi.org/10.52461/sabas.v3i2.737 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 100 that sharia life insurance in 2021 has reached 7 companies with a full shariah system and 23 conventional insurance companies that have shariah units. meanwhile, sharia general insurance now has 5 units with a full shariah system and 24 shariah units. furthermore, in december 2020, the growth rate of shariah insurance in indonesia increased by 5% with gross premiums reaching 15.37 trillion. whereas in the previous year, november 2019, the gross premium achievement of sharia insurance only reached 14.45 trillion. this means that the gross premium has increased by 5%. the development of sharia insurance in indonesia is very reasonable, given the level of awareness of the muslim community about risk management and their better financial literacy. moreover, the risk in islamic insurance is lower than conventional insurance. in addition, state legitimacy towards the halal status of shariah products through the dsn-mui fatwa is very important in the growth of this industry. islamic insurance companies have gone through many challenges to reach that point of growth. eliminating the paradigm of society that still equates sharia insurance with conventional is not easy. several innovations were carried out in order to expand the market share of islamic insurance. one of them is the emergence of the insurance waqf movement as a stimulant for some muslim communities which have been difficult to 'touch'. insurance waqf is a new innovation in the world of insurance and waqf in indonesia. the potential for this waqf is predicted to be large and it can even become a trend in the muslim community. the trend of waqf insurance can be seen from the number of sharia insurance companies that open waqf features. this proves that waqf can be an accelerator for other sharia economic activities. and on the other hand, the existence of insurance waqf is also very effective in optimizing the potential of waqf and increasing waqf fund. the insurance waqf movement requires a clear legal basis because it will combine two products in one contract, which each has a different and opposite character and concept. in a very basic concept, waqf and insurance seem to have no common ground. insurance is a form of risk mitigation against uncertainty about something that will happen in the future. that is, there is the principle of insurable interest as the basis for contracting interests in insurance agreements where this principle is an absolute requirement as the basis for insurance contracts and its absence will cause the insurance contract to be illegal or null and void. waqf is a voluntary activity that does not base its activities on risk. whereas in insurance there is a contract of adhesion provision which positions the insurance participant not to bid on the contents of the contract. this is very contrary to the principle of philanthropy. the disharmony between waqf and insurance can also be seen from the fully product motive (when waqif makes waqf the core goal in carrying out insurance). in addition to the inconsistent principle of insurable interest and contract of adhesion, problems will also arise in the event of a default, when the insurance participant can no longer fulfill his obligations in paying the policy so that the agreement can be canceled by law and the policy will change status to lapsed. as a result, the protection will be stopped and the premium paid is non-refundable. in this case, insurance participants whose main purpose is waqf will lose their capital because the premiums and benefits of the funds issued have been lost. this study examines the suitability of the fully product motive in insurance waqf in terms of the dsn-mui fatwa as the basis for this activities in indonesia to explore the limitations in it contracts so that they remain within the appropriate legal corridor. based on this background, this study will also examine the fully product motive in insurance waqf in indonesia and its conformity with shariah principles through a literature study on insurance waqf in indonesia and explore the previous research related to the same theme. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 101 part i – basic principles of sharia insurance in indonesia insurance is a form of protection that is closely related to profit and loss. khairandy said that insurance can bring the possible profit but can also cause losses. according to article 246 of the commercial code (kuhd) insurance or coverage is an agreement where an insurer can enjoy a premium that binds himself to the insured to free him from losses. from this explanation, it can be concluded that insurance is related to the insurer and the insured, uncertainty, risk transfer, premiums, and compensation. in islamic law, uncertainty and risk speculation are included in gharar and maysir. gharar is a contract that contains elements of profit and loss (speculation). if one party gains, the other party suffers a loss. while maysir is a form of transfer of property or goods without going through the contract path that has been determined by sharia. tarmizi said that maysir is forbidden because it contains elements of gambling. this concept is corrected in the shariah insurance system by including the concept of ta'awun (mutual assistance) and tabarru’ (voluntary contribution). insurance in islam is called at-ta-min or takaful which means mutual guarantee or mutual responsibility. takaful based on this understanding is based on three principles, there are the principle of mutual responsibility, the principle of mutual assistance and cooperation, and the principle of mutual protection. furthermore, ahmad azhar basir argues that takaful is based on two main concepts. the first is takaful which bears the risk of each other among its participants, in which the principle of mutual responsibility, cooperation, or assistance are enforced in the form of tabarru' and the second is adhering to the concept of mudharabah which is the concept of profit sharing from the profits obtained from the development of insurance funds from participant. the insurance company acts as the recipient of the trust from the participants to carry out mutual agreements for the risks suffered by the participants. with this principle, the elements of gharar, maisir and usury/riba (interest at unreasonable high rates) will disappear by themselves. although conventional insurance activities have been internalized with islamic values into the concept of takaful, there are some basic principles and characteristics in insurance that cannot be abandoned or must be fulfilled by both conventional and sharia insurance companies. the basic principles in insurance include: a. good faith principle or the existence of good faith or utmost good faith or the principle of perfect honesty. the element of mutual trust between the insured and the insurer becomes the most important capital so that both will provide each other with correct and honest information. if one day there is a deviation from the actual reality, the insurer has the right to cancel the insurance. b. insurable interest or interests that can be insured. each party entering into an insurance agreement must have an insurable interest. the point is that the insured must have involvement with the consequences of an event that is not certain to occur and the person concerned can suffer losses as a result of the event. this interest becomes very essential because its absence can invalidate the obligations of the insurer. this is stated in article 250 of the kuhd: "if a person who insures for himself, or someone, for whose dependents is held by another person, at the time the insurance is held does not have an interest in the object being insured, then the insurer is not obliged to compensate for the loss." so, the interest in insurance is absolute. c. indemnity principal or the principle of balance. through the insurance agreement the insurer provides a protection for possible economic losses that will be suffered by the south asian review of business and administrative studies vol. 3, no. 2, dec 2021 102 insured. the insurer provides protection in the form of the ability to provide compensation for the insured who suffers a loss due to an event or an uncertain event. khairandy further explained that the compensation for losses should not result in the insured's financial position being higher than before the loss occurred. d. subrogation principle or the principle of subrogation for the insurer. this principle involves a third party in terms of compensation when the third party commits an act that harms the insured. with regard to the principle of subrogation, article 284 of the kuhd explains "the insurer who has paid for the loss of an insured object gets all the rights that the insured has against a third person regarding the loss and the insured is responsible for any actions that may harm the rights of the insurer against those three people." e. contribution principle or the principal of contribution is if an insured covers insurance for the same object and for the same risk to more than one insurer in different policies, it can cause double insurance. if this happens, each insurer according to the amount for which they signed the policy, bears only the actual price of the loss suffered by the insured. while some of the inherent characteristics of the insurance agreement include: a. that the insurance agreement is aletary in which the performance of the insurer still has to depend on an uncertain event, while the achievement of the insured is certain. b. the insurance agreement is a conditional agreement in which the insurer's performance will only be carried out if the conditions specified in the agreement have been fulfilled c. the insurance agreement is unilateral or one-sided in which only the insurer makes a promise while the insured does not make any promises d. an insurance agreement is an agreement attached to the terms of the insurer (adhesion) in which almost all the terms and contents of the agreement as outlined in the policy have been determined unilaterally by the insurer. e. agreement with perfect good faith or free from bad intentions having the same basis and nature of the agreement, islamic insurance provides an explanatory boundary as the difference between the two. the difference lies in risk management (sharing of risk), more transparent fund management, a system of agreements with tabarru' (voluntary contribution) contracts, joint ownership of funds and profit-sharing mechanisms. regulations regarding shariah insurance are still based on the insurance law in general, namely law no. 40 of 2014. in its implementation, muslims usually refer to the dsn-mui fatwa no. 21 of 2001 concerning sharia insurance. in the fatwa, the types of sharia insurance are divided into two. the first is life insurance and the second is loss insurance. while the contracts used for both are mudharabah (profit sharing contract in which one party provides funds and the other management expertise) and hibah (transfer of a determinate property (mal) without any material consideration). part ii – insurance – waqf in indonesia waqf, like other muamalah (transaction according to shariah) activities, has pillars and conditions that must be met in its implementation. the pillars of waqf are waqif (the party who waqf their property), mauquf 'alaih (the beneficiaries or parties who benefits from the waqf), mauquf bih (waqf object), and shighat (statement of the will of the waqf). jaih mubarok and hasanudin mentioned that among the pillars that need to be considered are those relating to mauquf (waqf objects): a. the assets that are donated must be valuable assets according to sharia b. the assets that are donated must be clear and measurable south asian review of business and administrative studies vol. 3, no. 2, dec 2021 103 c. assets that are donated are assets that have become the property of the waqif perfectly d. the assets that are donated are clear assets, not assets that must be divided because there are other parties' property rights. in indonesia, the emergence of law number 41 of 2004 concerning waqf which was followed by government regulation number 42 of 2006 concerning the implementation of law number 41 of 2004 is part of the movement to develop, expand, and renew waqf objects or their management to be more productive and can be used proportionally. the expansion of waqf object stimulates the existence of insurance waqf which cannot be separated from the widespread development of cash waqf which has led to the proliferation of new trends in the world of waqf. at the first glance, there is no common ground between waqf and insurance but if examined further, it will be seen that the similarities between the two are related to preparation and self-planning to welcome death. in death planning insurance, the plan is more intended for the heirs, while in waqf the preparation is made for personal preparation for welcoming death because of the waqif’s full awareness of the existence of life after death. therefore, the existence of insurance waqf is a win-win solution for both the individual and the heirs. seeing these benefits, the indonesian ulema council (mui) compiled a fatwa regarding insurance waqf no. 106 of 2016 concerning insurance benefit waqf and investment benefits in sharia life insurance. this means that this fatwa is only intended for sharia insurance and not conventional. the fatwa was then followed up by several sharia insurance companies by compiling the concept of waqf and applied through several models. the models are a. waqf fund is a waqf as an insurance model where the sharia insurance company at the beginning of its formation will provide funds intended for waqf and the funds are placed in a fund. b. insurance policy waqf is when the policy holder makes waqf to the waqf body or institution at the discretion of the policy holder himself. c. waqf as a feature of sharia insurance products is when a general product made by a sharia insurance company provides an opportunity for insurance participants to provide insurance benefits as waqf. d. waqf as one of the product names in sharia insurance companies from the explanation above, it can be concluded that waqf in insurance can be used in its entirety where the initial formation of an insurance company was intended for waqf activities but can also be one of the features in a series of insurance activities. part iii – fully product motive in insurance waqf loundon and della betta say that motive is a state that moves energy and physical energy in a human being that leads to a goal. this means that the motive greatly influences a person in carrying out an action. motives in islam are called intentions. intention is the first rule in fiqhiyyah rules because it becomes a very important basis in the implementation of worship. this intention will explain the worship that will be carried out and will determine whether an action is an act of worship or not. in waqf, the motive/intention will be closely related to waqif and mauquf because it will determine the waqf contract. for example, does the waqif intend to waqf his property temporarily (mu'aqqat) or forever (muabbad), or does the waqif want to waqf his mauquf into khairi waqf or family waqf. regarding insurance waqf, habibaty and latif explained that there are two motives that underlie a person to take insurance waqf products, namely fully product and product features. fully product south asian review of business and administrative studies vol. 3, no. 2, dec 2021 104 is when the waqif makes waqf the core goal in carrying out insurance. while the product feature is when waqif makes waqf only as an additional product taken apart from the core products. because the waqf property must remain and last forever, the waqf insurance contract in relation to the fully product motive can be a problem. this is because insurance waqf activities may bring consequences that cause the property to be lost. these consequences arise if one day the insurance waqf participant cannot fulfill his obligation to pay the premium so that the dependent status becomes lapsed. it means that nothing can be channeled at all for waqf. whereas the initial intention of the waqif to carry out the transaction was to repay the waqf payment and hand over the entire property for waqf at a later date. in addition, the principle of aletary insurance also cannot be fulfilled in the full motive. there should still be another interest in the agreement relating to insurance with regard to events that are not certain to occur in the future. this 'aletary' can fulfill the principle of insurable interest where its absence can cancel the obligation of the insurer. the act of waqf is not based on any interest except to return ownership of property to allah swt. in addition, in the insurance waqf, the waqif does not have the free authority to determine the contents of the contract agreement because the insurance agreement is attached to the insurer's requirements (adhesion) because almost all the terms and contents of the agreement set forth in the policy have been determined unilaterally by the insurer. this is in stark contrast to waqf which is voluntary in nature. furthermore, with regard to the fully product, ownership of property is crucial. waqf of insurance benefits and investment benefits can only be implemented after the policyholder dies so that the ownership of the policy becomes the property of the beneficiary. the policy holder only makes a binding promise that he will donate his property when he dies. this is absolutely necessary in order to fulfill the 'milku tam' element in the waqf when the property has become the full property of the waqif. in the context of insurance, the new policyholder will receive his insurance benefits when he has died. therefore, the waqf pledge is not made by the policy holder but by the policy beneficiary. furthermore, the benefits obtained by the beneficiary after the policy holder dies are included in the 'tirkah' (heritage) property so that laws relating to inheritance are also subject to insurance waqf. the policy holder's promise to endow his wealth later if he dies is included in the will. in the will, the maximum amount is 1/3, so it is not allowed to donate all policies received except with the permission of all heirs. in indonesia, some of these problems have been responded to by the indonesian ulama council (mui) by enacting several special provisions contained in fatwa no. 106 of 2016 so that insurance companies pay attention to the important aspects in the implementation of insurance waqf, for example, the provisions in the waqf of insurance benefits.the party appointed to receive insurance benefits must declare a binding promise to waqf insurance benefits at most 45% of the total insurance benefits. this is to protect the insurance principle related to the fulfillment of the insurable interest aspect so that there is still an interest owned by the policyholder in the form of events that will occur and be borne by the insurance company. furthermore, it is related to the provisions of the investment benefit waqf. investment benefits may be waqf and the maximum amount of investment benefits is 1/3 of the total wealth unless agreed by all heirs. this is related to the application of will law in inheritance which allows only 1/3 of the total assets of the deceased. conclusion after conducting various analysis regarding insurance policy waqf and insurance benefit waqf, the motive for the fully product is not in accordance with several sharia provisions. in addition, there south asian review of business and administrative studies vol. 3, no. 2, dec 2021 105 are several principles in insurance that are violated. first, there is the potential for waqf assets to be lost if waqif cannot fulfill the obligation to pay the premium properly. second, in the insurance waqf, waqif does not have the authority to freely determine the contents of the contract agreement because the insurance agreement is attached to the insurer's requirements (adhesion), that is, almost all the terms and contents of the agreement as outlined in the policy have been determined unilaterally by the insurer. whereas waqf is a voluntary activity. third, the investment benefits that are distributed must not violate wills in islamic inheritance law, which is a maximum of 1/3 except with the approval of the heirs. therefore, if an insurance participant wants to participate in an insurance waqf activity, his or her niyyah or intention to have insurance must be placed at the beginning, as the basis for carrying out the transaction. this is necessary in order to fulfill the principle of insurable interest which must always be prioritized for all types of insurance. as for if he later wants to endow the insurance or investment benefits, then he must still pay attention to some of the provisions of the shariah regarding inheritance and wills. references abdul rahman ghazaly, dkk, fiqih muamalah, jakarta: kencana, 243 azhar alam, sukri hidayati, akad dan kesesuaian fitur wakaf produk asuransi jiwa syariah, equilibrium: jurnal ekonomi syariah volume 8, nomor 1, 2020 diana mutia habibaty, azharuddin lathif, fenomena wakaf asuransi dalam prinsip insurable interest, jurnal penamas volume 33, nomor 2, juli-desember 2020 dewi hanggraini, manajemen risiko pembiayaan syariah, bogor: pt. penerbit ipb press, 2019, 25 erwandi tarmizi, harta haram muamalat kontemporer, bogor: berkat mulia insasni, 2013, 205 herlina yustati, signifikansi wakaf manfaat asuransi melalui instrumen asuransi jiwa syariah bagi lembaga wakaf al-azhar, syi’ar iqtishadi vol.5 no.1, may 2021 joko tri laksono, perlindungan hukum pemegang polis asuransi terhadap kendaraan bermotor dalam angkutan penyeberangan, jurnal hukum magnum opus agustus 2018 volume i, no 1 muhammad syakir sula, konsep asuransi dalam islam, bandung: ppm fi zhilal 1996, 1) ridwan khairandy, pokok-pokok hukum dagang di indonesia, yogyakarta: fh uii press, 2014 siswadi, prinsip-prinsip hukum dalam praktik asuransi sebagai solusi menghindari kerugian atas peristiwa yang terjadi pada lembaga perasuransian, jurnal ummul qura vol xi, no. 1, maret 2018, 154. stephani inggrid gejali, motivasi dan motif konsumen membeli dan investasi lm antam di surabaya, jurnal ilmiah mahasiswa universitas surabayavol.4 no 12015 yovenska l.man, aktualisasi asuransi syariah di era modern, mizani volume 4, no. 1, 2017 https://lifepal.co.id/, 2021 international labour organization. n.d. "glossary". ilo. https://www.socialprotection.org/gimi/showglossary.action?lettre=t&gloslang=en, acessed 25 october 2021 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 106 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 121 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas waqf model of madinah mawaddah waqf city: an analysis asharaf mohd ramli, universiti sains islam malaysia, malaysia norman hamdan, universiti sains islam malaysia, malaysia abdullaah jalil, universiti sains islam malaysia, malaysia article details abstract history revised format: nov 2021 available online: dec 2021 keywords madinah mawaddah waqf city (mmwc), land waqf, cash waqf the private endeavor to establish waqf has spurred the development of waqf worldwide. corporations, companies, and islamic financial institutions in several countries such as turkey, pakistan, and malaysia have created, managed, and distributed waqf proceeds to the designated beneficiaries in various sectors, namely, health, education, and social. recently, pahang state foundation (yayasan pahang), a subsidiary of the malaysian state of pahang, launched madinah mawaddah waqf city (mmwc) with the dedication of 187 acres of land as waqf to pahang islamic religious and malay customs council (muip). the initiative to develop mmwc is considered one of the most significant waqf land development projects undertaken by a private company in malaysia. the paper's objective is to examine and scrutinize the structure of the waqf model of mmwc, which includes the governance, management, and underlying shariah principles applied to establish mmwc. this paper is conceptual, and the authors use content analysis, library research, and case study methods to reach the findings. the study's findings could provide some insight into applying the waqf model within the institutional framework of a corporate or private company. future studies can specifically examine other aspects of waqf management, such as financial aspects. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: asharaf@usim.edu.my doi: https://doi.org/10.52461/sabas.v3i2.738 introduction waqf is one of the voluntary charitable mechanisms in islam and has provided considerable contributions to the development of islamic society since the early days of islam until now. the prophet and his companion have shown the practice of dedicating assets as waqf for funding almost all economic, education, health, and social sectors and followed by muslims. the massive role of waqf institutions in the country's economic development is evidenced during the ottoman empire. https://journals.iub.edu.pk/index.php/sabas mailto:asharaf@usim.edu.my https://doi.org/10.52461/sabas.v3i2.738 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 122 waqf institutions play a vital role in economic development by helping and supporting efforts to develop various facilities, including educational facilities, health, places of worship, and other facilities for the people such as bridges and roads. with the importance of waqf and its benefits to muslims, especially from the economic aspect, the issues and weaknesses related to the management of waqf should be an essential aspect to be addressed by muslims. the problem of waqf management occurs in most countries that practice it, including malaysia and neighboring indonesia as well as bangladesh including the issue of strengthening education and the overall inefficiency of waqf management which requires organizational structuring to increase the accountability of waqf institutions. waqf management should be efficient. and by the needs of the times, especially from the aspect of governance and waqf distribution methods. this study scrutinizes the model of waqf explicitly in terms of the sources of waqf fund, the development of waqf asset, the management of waqf assets, and the distribution of waqf proceeds (ghallah), specifically in madinah mawaddah waqf city (mmwc) in the form of a case study to look indepth at the four aspects mentioned earlier. the participation of a corporate body in this new model could bring along the corporate culture of professionalism, good administration which is free of corruption in the execution of wqaf. literature review the leading writing of waqf in islamic sharia and latest advancement in malaysia is briefly elaborates in this section. the involvement of private entities in the development and management of waqf. waqf understanding the literal meaning of waqf is detention or prevention. the scholars of islamic jurisprudence define waqf as a gift in which the corpus is detained, and the usufruct is set free. the detention of the corpus means the exclusion of waqf assets from any disposition in simple words the waqf assets can’t be sold or gifted, rented out or mortgaged. the dedication of the usufruct denotes that there will be no financial return for the waqif (endower) is main purpose of it. therefore, the technical meaning of waqf is a valuable entity that is dedicatedly and completely handover or give in the use for an infinite period of time. moreover, the original endower or others have no right of disposition to a permissible existing party or by channeling its yields or proceeds to charitable and goo purpose for the sake of allah. there are three categories of waqf based on the perspectives of the heiress, the wqaf purpose, and the subject matter of waqf . the first category of waqf, namely, waqf beneficiaries, is divided into two groups; waqf khayri (charitable endowment) or waqf ahli/dhurrie (endowment for offspring). the beneficiaries of waqf khayri are diverse, comprising individuals and institutions of various sectors, including education, health, and social. meanwhile, the waqf ahli/dhurrie beneficiaries are limited to relatives, blood relations, and their dependents. suppose a waqf giver dedicated an asset for a particular purpose; for example, they dedicated a piece of land as a waqf to construct the religious school. in that case, the waqf manager is obliged to adhere to the condition. however, if the waqf giver mentions no specific situation, the waqf manager has the freedom to determine the land usage according to the need. the third category is the subject matter of waqf that could be classified into immovable assets (waqf al-'aqar) such as land or moveable assets (waqf almanqul) al-quran and money. nowadays, cash waqf is the most popular type of waqf asset that is structured for funding the development of existing assets, or the fund is channeled into purchasing new waqf assets. in contrast to immovable properties, for example, land and building, cash waqf is the easiest and the cheapest method of doing waqf without incurring a considerable amount of money. in muslim south asian review of business and administrative studies vol. 3, no. 2, dec 2021 123 countries worldwide, government and private agencies have established cash waqf funds and channeled waqf proceeds for various sectors, particularly education, health, and social. private entities involvement in waqf the expansion of waqf entities in malaysia is highly dependent over private and corporate bodies collaboration as per the latest updates in this field. the progress can be identified through such corporate culture where corruption fee administration executes operations, better controls can be built though audits. moreover, professionalism corporate properties' engagement in waqf activities could represent the corporate world's ethical dimensions. considering several issues associated with waqf authorities, the involvement of corporate and private bodies in waqf affairs is noticeably imperative. the issues of underdeveloped and negligent waqf properties in some muslim and nonmuslims are usually associated with the mismanagement of waqf authorities. for that reason, the new dimension of good governance of waqf affairs is expected to materialize with the cooperation between waqf agencies and corporate bodies. private entities such as corporations, companies, private higher learning organizations, and islamic financial institutions have established and managed waqf assets. these institutions’ involvement in waqf affairs depends on the approval granted by sirc through the issuance of mutawwali khas or nazir khas status, considering all aspects of waqf assets are endow under the jurisdiction of state islam religious councils (sirc) in each state. table 1: corporate and private entities involved in waqf corporate/private entity type of waqf purpose waqaf an-nur corporation (wancorp) corporate waqf health & social tabung haji land commercial uda holdings land commercial & social iium, ukm, upm, usim, utm cash waqf education college university of bestari (cub), islamic universiti of malaysia (ium), college of professional baitulmal (cpb) cash waqf education bank muamalat cash waqf education, health & social awqaf holdings berhad corporate waqf health & education consortium of 6 islamic banks (bank muamalat, bank islam,. maybank islamic, cimb islamic, rhb islamic) cash waqf education, health & social labuan international waqf foundation (liwf) waqf foundation social khadijah international waqf (l) foundation (kiwf) waqf foundation social pmb investment waqf unit trust social asnb wakaf waqf unit trust social table 1 depicts several corporate and private entities involved in the development and management of waqf assets in malaysia. the first corporate entity that engages in the administration of waqf affairs is wakaf annur corporation (wancorp), a subsidiary of johor corporation (jcorp), owned shares with the total amount of rm200 mil as waqf. the proceeds generated from the stakes have been allocated to fund the designated beneficiaries in health and social . this type of waqf is also known as corporate waqf that several corporations apply in turkey, pakistan dan bangladesh south asian review of business and administrative studies vol. 3, no. 2, dec 2021 124 . after twenty years of its establishment, as of 2020, wancorp has expanded its clinic waqf chain that is also known as rangkaian klinik wakaf an-nur (rkwan) to 21 and provided treatment to more than one million patients regardless of race and religion. the bold initiative of waqf authorities and corporate bodies to cooperate for waqf development has attracted several companies to participate in this charitable activity. for instance, the development of menara bank islam on a piece of waqf land located in jalan perak, kuala lumpur, involved the collaboration between tabung haji (th) and majlis agama islam wilayah persekutuan (maiwip). as the project’s financier, th was responsible for constructing the building and appointed its subsidiary th property to manage the property upon completion. since its finalization in 2011, the property has been leased to bank. the joint venture involving these two entities play a signiant role in developing waqf asset, and at the same time, the rented income from the commercial lots becomes a new source of income for mainpp. the acceptance of the cash waqf concept by malaysian religious authority is another milestone for the participation of private entities in waqf practice. several private higher learning institutions, namely, cub, ium and cpb established a cash waqf scheme to fund their students' scholarship schemes. this arrangement has been successfully implemented in several public universities, such as iium, upm, ukm, usim, and utm. the recent development of waqf products and instruments are the introduction of waqf foundation and waqf unit trust. liwf is the first waqf foundation established in 2015 that is governed by the labuan foundations act 2010. liwf offers the endower (waqif) to dedicate shariah-compliant properties such as real estate and money as waqf. in 2018, another waqf foundation known as khadijah international waqf foundation was established and governed by labuan islamic financial services act 2010. meanwhile, waqf unit trust is a new milestone for waqf development with the introduction of pmb an-nur waqf income by pmb investment and asnb wakaf by permodalan nasional berhad (pnb) in mac and october 2021, respectively. these instruments offer opportunities for the endowers to involve in waqf activities by purchasing waqf unit trust. the preceding paragraphs elaborate on the participation of corporate and private entities in charitable activities through waqf. it is found that the collaboration between these two bodies contribute to the expansion of cash waqf instruments consisting of the cash waqf scheme, waqf foundation, and waqf unit trust. the proceeds of the cash waqf fund are channeled for funding several sectors, including education, health, and social. research method the research method used in this research was content analysis and library research. the study also adopted the case studies method. it is beneficial when the investigation is in-depth and focuses on individual units of analysis such as individuals, communities, or organizations. it provides an opportunity for research to be conducted with a holistic perspective on the problems of the study and the ability to describe the problems and phenomena being studied. thus, this study is appropriate to adopt a relevant case study to answer the questions of "how" and "why". this study applies the purposive sampling method in selecting the studied organizations. the organization chosen is madinah mawaddah waqf city. the selection of this organization is based on the criteria and privileges of mmwc as the first waqf city project in malaysia. this project is initiated by yayasan pahang and get the approval from pahang state islamic religious and malay custom council (muip) as the sole trustee of waqf assets in pahang. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 125 model of madinah mawaddah waqf city: an overview madinah mawaddah waqf city (mmwc) is the first waqf city model in malaysia. yayasan pahang is the key player in the development of mmwc as it is the main waqf funder (waqif) of this project and has been later appointed by pahang state islamic religious and malay custom council (muip) as the mutawalli of mmwc. figure 1. model of madinah mawaddah waqf city figure 1 shows the model of mmwc that is based on the primary waqf contributions by yayasan pahang in the forms of land and cash. yayasan pahang has contributed its 187 acres of land to muip as a waqf asset, and it has become the project site of mmwc. apart from the ground, yayasan pahang has also contributed a cash waqf value of rm30 million to initiate the development of the waqf city. sources of waqf funds may also come from the public. yp land sdn bhd, a subsidiary company of yayasan pahang, was appointed as the leading developer for this project. yp land will build a mosque, retirement home units, and essential commercial premises during the initial development phase. once the construction of these buildings is completed, the ownership of these properties will be transferred to the sole trustee of waqf in pahang, the muip. yayasan pahang has been awarded the status of mutawalli on 10 november 2020 by pahang state islamic law consultative committee, pahang state islamic religious and malay custom council (muip) to manage all waqf properties in madinah mawaddah waqf city . it is proposed that muip and yayasan pahang will form a committee to oversee and monitor mmwc. in the meantime, a corporate entity (perbadanan mmwc) will be formed by yayasan pahang to run the day-to-day operation in the waqf city. perbadanan mmwc would rent the retirement home and the commercial units, and all the rental proceeds will be accumulated in the challah fund. the challah fund provides a sustainable stream of income for perbadanan mmwc to manage the entire south asian review of business and administrative studies vol. 3, no. 2, dec 2021 126 city. perbadanan mmwc will use the fund to cover the administration expenditures (idari), to support the expenses for social or community programs (ijtima'i), and to finance educational projects ('ilmi) such as financial education helps for asnaf group of students to further their studies. governance of mmwc governance is one of the essential elements in corporate and public practices. previous studies indicate that waqf governance and reporting structure of waqf institutions may vary and still be undeveloped, requiring special attention. mmwc is envisaged to lead malaysia's modern city. due to its uniqueness, it is proposed that the city is managed by two parties ie pahang state islamic religious and malay custom council (muip) and yayasan pahang (yp). a committee named madinah mawaddah joint-committee (mmjc) will be established as a policymaker and a key player in running the city until a new entity such as perbadanan wakaf mmc is registered. the structure of mmjc of mmwc will be led by a chairman, two representatives from muip, three representatives from yp, and two external professionals. upon approval of perbadanan wakaf mmwc, the new structure will follow the standard corporate management structure presented in figure 2 below. figure 2: the proposed of the governance structure of mmwc the new institution will follow current companies law, shall be run by its board of directors (bod). the bod comprises one chairman, one mufti office, one representative from muip, three representatives from yp, and two independent professionals. to ensure proper governance is in place, the mmwc will be supervised by three crucial portfolios. investment, audit & risk management, and syariah committee. each portfolio will be headed by one of the board members. shariah considerations of mmwc this section deals with the authors' endeavor to justify the shariah framework of madinah mawaddah waqf city is based on the program's modus operandi depicted in figure 1. in terms of south asian review of business and administrative studies vol. 3, no. 2, dec 2021 127 the classification of waqf based on the subject matter, mmwc is a form of waqf musytarak through the combination of land and cash waqf handled by a team of corporate bodies and state authorities representatives. therefore, the involvement of a corporate institution, namely, yayasan pahang, in the establishment and management of mmwc could be considered corporate waqf. meanwhile, the donor of this type of waqf consists of institutions and individuals. the management of mmwc is assigned to perbadanan mmwc as the manager or mutawwali of waqf assets and is responsible for managing the fund and channeling the fund’s proceeds to the beneficiaries. by looking at mmwc waqf’s purpose for education, healthcare, and social purposes, it is clear that it is a form of waqf khairi (charitable waqf) and not a waqf dhurri. the summary of mmwc’s shariah consideration defects in the following table: table 2: shariah consideration of madinah mawaddah waqf city no aspect shariah consideration 1 subject matter of waqf waqf musytarak through the combination of land and cash 2 purpose of waqf waqf khairi (charity) 3. beneficiries of waqf waqf ‘amm (general) and waqf khass (specific); needy party in the areas of education, healthcare and social 4 waqf donors or waqif consists of individuals and institutions 5 manager of waqf or mutawwali yayasan pahang 6 type of waqf management corporate 7 the timing of waqf perpetual conclusion the involvement of corporate entities in waqf exercise could signify the corporate world's ethical dimensions. considering several issues associated with waqf authorities, for instance, lack of management, mismanagement, and accountability, the collaboration between corporate and private entities in waqf affairs is imperative significantly. thus, this study examined the model of mmwc established by yayasan pahang from the perspectives of sources of waqf assets, the development, the administration, and the distribution of waqf proceeds or ghallah. from the results of the study, mmwc was found to be a very well-structured waqf model developed by a corporate body. the collaboration between muip and yp could bring a new dimension to the development of hybrid-waqf in the country. the success of this project could motivate other corporate or private entities to involve in waqf projects. future studies can examine in more depth other aspects of waqf management in a more specific manner, such as financial aspects and other management aspects. references abdul mubaraq, (2018). the waqf management: 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(2009) case study research: design and methods. 4 ed. los angeles, sage. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 130 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 131 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas foreign remittance inflow in bangladesh: a statistical analysis md. nur nobi, al madina international university, malaysia md. arif billah, international islamic university, bangladesh tani jannat, jagannath university, bangladesh asaduzzaman shohel, international islamic university, bangladesh article details abstract history revised format: nov 2021 available online: dec 2021 keywords foreign remittance, money laundering, foreign exchange, foreign trade, migration, economy the major goal of this research is to assess bangladesh's foreign remittance inflows in recent years, remittance has risen to prominence as one of the most important economic variables, since it helps with the surplus balance of payments, foreign reserves, aggregate savings, and money circulation after overcoming the negative effects of the covid-19 pandemic, bangladesh's foreign trade has begun to improve in comparison to the previous fiscal year, total export earnings declined by 16 93 percent to us$ 33,674 09 million in fy 2019-20 during the first half of fiscal year 2020-21, export earnings totaled us$ 35,180 81 million, up 13 64 % over the same period the previous fiscal year furthermore, remittance earnings are growing at a slower rate than emigration from bangladesh, owing to a rising number of unskilled or semi-skilled laborers in overseas migration rather than professionals remittances have a great impact on bangladesh's economy. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: mdnurnobihub28@gmail.com doi: https://doi.org/10.52461/sabas.v3i1.732 introduction the significance of remittances from abroad in bangladesh's economy is well understood and requires no explanation. remittances have been highlighted as one of the three important variables to reduce poverty in bangladesh, alongside the agriculture and readymade garment (rmg) sector. remittance inflows climbed by 9.60 percent to us$ 16,419.63 million in fy2018-19, compared to the previous fiscal year. remittance inflows totaled us$ 18,205.01 million in fy2019-20, up 10.87 percent from the previous fiscal year. middle eastern countries account for the majority of remittances. the top the list in fy2019-20 is, kingdom of saudi arabia (ksa) 22.06%, united arab emirates (uae) 13.58%, and the usa 13.21% (bangladesh economic review-2021). remittances from the united states have increased significantly in this area. as a result, we recommend conducting a statistical study on the effect of remittances on per capita earnings, which have a direct impact on household welfare, in order to eliminate such speculation and move the conversation away from the qualitative domain and onto a more secure, quantitative foundation. this work is required in order to obtain more precise results, which will aid in the establishment https://journals.iub.edu.pk/index.php/sabas mailto:mdnurnobihub28@gmail.com https://doi.org/10.52461/sabas.v3i1.732 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 132 of future policy guidelines. remittances are one of the most important tools for solving our crisis and supporting the economy. migration is one such procedure that aids in the reduction of unemployment, the increase of reserves, the improvement of the balance of payment, and a variety of other socio-economic factors. unemployment is one of a country's most worrying economic indicators; migration and subsequent remittance are mostly linked to employment and foreign currency earnings. as a result, remittances are a critical issue in overcrowded countries like bangladesh. as a result, we must pay close attention to this topic. it also aids in the growth of foreign reserves, savings, and investments in the country. it improves living standards, social standing, and helps meet fundamental necessities from a socioeconomic standpoint. core objectives of this study the main objectives of the study are to determine the amount of foreign remittances received in bangladesh over the previous ten years; to evaluate the source, and impact of foreign remittances on bangladesh's balance of payments; to determine the primary factors of international remittances, as well as the restrictions and opportunities; to concentrate on the socioeconomic impact of remittances from abroad on bangladesh's economic development; to take recommendations for expanding international remittances and eliminating administrative hurdles and shortcomings. the research methodology this study is primarily based on secondary sources, gathered from a variety of documents and papers, including the bangladesh bank's annual report, the bangladesh bank's statistics department's monthly economic trends, the bangladesh economic review -2021, website data, news papers, journals, and selected books, covering the years 2010-2020. in some circumstances, additional years have been taken into account. on the basis of the available data, the study's analysis was carried out in tabular form, charts, and diagrams. literature review according to the article “remittance as a tool of economic development: bangladesh perspective,” written by chowdhury, kuntal roy, fauza hamid & d. d. chatterjee. (2010) and others, “recently remittance is the preeminent variables in bangladesh economy, as it helps to increase balance of payments, increase foreign exchange reserves, boost national savings, and increase money velocity’. according to a study by muntakim m. choudhury and colleagues titled "the global financial crisis and its impact on bangladeshi remittance, “remittances have generated around 35 percent of export earnings over the last two decades. remittance systems can be classified into two categories: official and informal. financial systems that are governed by a set of rules are known as formal financial systems. government agencies and regulations regulate the formation, characteristics, activities, and closure of money-transaction entities in formal systems (apec, 2003: 3). m. serajul islam wrote “banks and the foreign remittance business.” he learned that one of bangladesh's biggest economic success stories is overseas remittances. last year, about 10 million bangladeshis sent roughly 17 billion dollars in foreign currency to the country. according to a study by aktar-uz-zaman kazi, "foreign remittance volatility must be stabilized." he notices that the amount of overseas remittances coming into our country has been fluctuating in recent months. the previous fiscal year finished with a 13.25 percent improvement over the previous year's results. remittances are bangladesh's main source of foreign currency. remittance inflows have climbed by 10-32 percent in the last 20 years, and this trend has continued even during the global recession of the last decade. everyone understands the importance of remittances. it reduces the country's dependency on aid from abroad. while commodities carried by migrants are not strictly remittances, they account for a considerable amount of the salaries earned. the paper "general overview of remittance inflow in bangladesh" was written by fariha haque. this research aims to create a theoretical framework for studying the economic impact of south asian review of business and administrative studies vol. 3, no. 2, dec 2021 133 worker remittances in bangladesh. according to the findings of amjad r.'s report "impact of middle east workers' remittances on pakistan economy: some selected issuesthe pakistan development review (1986)," remittance inflows increased by $1.5 billion in 18 years, from $0.2 billion in 1980 to $1.7 billion in 1999. remittances generated around 53.34 percent of bangladesh's overall balance of payment in 1996-97. based on the foregoing literature, it is obvious that bangladesh's government and migrant laborers require significant research. as a result, the researchers chose this topic as the focus of their current investigation. major findings concept of foreign remittance the term "foreign remittance" refers to the acquisition and selling of freely convertible foreign currencies as permitted by the country's exchange control regulations. inward international remittance is the purchase of foreign currencies, while outbound foreign remittance is the sale of foreign currencies. as a result, we can distinguish between two types of overseas remittance: inward and outbound. workers' remittances are defined by dilip (2002) as the sum of three components: (i) worker remittances, which are recorded in the current account of the balance of payments under the "income" heading; (ii) employee compensation, which includes wages, salaries, and other border, seasonal, and other non-resident workers (such as local staff of embassies); and (iii) is recorded in the current account of the balance of payments under the "income" heading. the economic importance of remittance income in bangladesh bangladesh's economic progress and people's livelihoods have become increasingly dependent on remittances. in a developing country like bangladesh, remittance revenue is more valuable. according to puriand ritzema, remittances, which are a portion of international migrant workers' salaries transferred back to their home country from their place of employment, play a critical role in the economies of many labor-sending countries (2001). remittances, according to osmani, are one of three factors that have contributed to a reduction in the general prevalence of poverty in bangladesh (2004). for a variety of causes, the demand for migrant workers' remittances has skyrocketed in bangladesh. remittances contribute significantly to our country's economy by raising job opportunities that led to strengthen foreign exchange reserves, and per capita income. a steadily increasing bangladesh's gdp (gross domestic product). migrant workers' remittances are expected to account for 13% of bangladesh's overall gdp in 2020. through the development microfinance institutions, remittances have continually contributed to bangladesh's poverty reduction, resulting in significant employment and income that assist bangladesh in improving its balance of payment condition. remittance money has been used to pay various government and non-government import expenditures, as well as installments of various international debts and donations. remittance money allows bangladesh's government to minimize its reliance on foreign aid. bangladesh's government uses remittance money on a variety of projects, including bridges, highways, and hospitals, etc. which has a favorable impact on migrant families' socioeconomic situation. remittance money strengthens the local currency (bangladesh) in relation to the us dollar. country wise remittance inflow in bangladesh remittances and overseas employment due to the global epidemic, adverse conditions in abroad employment are prevalent. the prolonged decline in fuel prices has stifled economic activity in the middle east's oil-producing countries. overall, 6.93 lakh people were exported in fy2018-19, a decrease of 21.26 % from the last fiscal year. in earliest 9 months of fy2019-20, 5.31 lakh peoples were employed in overseas, 2.73 % bigger from foregoing fiscal year's first nine months (ber -2021). remittances from workers inward remittances from bangladeshis working abroad, which accounted for 11.24 percent of total current account surpluses, remained a substantial source south asian review of business and administrative studies vol. 3, no. 2, dec 2021 134 of current account surpluses. remittance receipts increased by 10.9 percent to usd 18205.01 million in fy20, compared to usd 16419.63 million the year before. expats were able to raise remittance inflows again because to government incentives, the convenience of sending remittances through formal channels, and several supportive policies on remittances. the bangladesh bank decreased the security deposit required for exchange houses abroad to make drawing arrangements with local banks in order to speed up the official process. there are more than 334 exchange houses in the world. the uae (13.58%), the usa (13.20%), kuwait (7.54%), the united kingdom (7.50%), oman (6.80%), and malaysia (6.80%) are the top five countries (6.80 percent). in fy20, ksa was the source of the most remittances (22.1 percent). for the same time period, all other countries contributed 22.55 percent of total remittances. inflows of remittances by nation are shown in table 1 for fy20. table 1: country wise remittances inflow in fy 20 figure 1: country wise remittances inflow in fy 20 source: bb annul report 2020 table 2: trends in foreign exchange reserves country % usa 13.2 uk 7.5 malaysia 6.8 oman 6.8 kuwait 7.5 uae 13.6 ksa 22.1 other countries 22.5 year (end june) total reserves (million usd) 2010 10,750 2011 10,912 2012 10,364 2013 15,365 2014 21,508 2015 25,025 2016 30,168 2017 33,493 2018 32,943 2019 32,717 2020 36,037 13.2 7.5 6.8 6.8 7.5 13.6 22.1 22.5 0 5 10 15 20 25 usa uk malysia oman kuwet uae ksa other countries % south asian review of business and administrative studies vol. 3, no. 2, dec 2021 135 figure 2: trends in foreign exchange reserves source: a&bd, bb (2021) the bangladesh bank's foreign exchange reserves have remained stable. bangladesh bank's overall foreign exchange reserves climbed to us$ 36,016.76 million by june 2020, up from $32,717 mil. at the end of june 2019. it is especially noteworthy that in october 2020, foreign exchange reserves have reached the all-time high level of us$ 40 billion. table 2 show the foreign exchange reserve position at the end of june 2008 to june 2020. table 3: medium term macroeconomic framework: key indicators projection indicators fy17 fy18 fy19 fy20 fy21 fy22 fy23 1 3 4 5 6 7 8 8 real sector real gdp growth (%) 7.3 7.9 8.2 5.2 8.2 8.3 8.4 cpi inflation (%) 5.4 5.8 5.5 5.6 5.4 5.3 5.2 investment (% of gdp) 30.5 31.2 31.6 31.7 33.5 34.5 35.6 private 23.1 23.3 23.5 23.6 25.3 26.6 27.7 public 7.4 8.0 8.0 8.1 8.1 7.9 7.9 fiscal sector (% of gdp) total revenue 10.2 9.6 9.9 12.4r 11.9 12.1 12.2 tax revenue 9.0 8.6 8.9 11.2r 10.9 11.0 11.1 of which nbr tax revenue 8.7 8.3 8.6 10.7r 10.4 10.5 10.6 non-tax revenue 1.2 1.0 1.0 1.2r 1.0 1.1 1.1 public expenditure 13.6 14.3 15.4 17.9r 17.9 17.1 17.2 of which adp 4.3 5.3 5.8 6.9r 6.5 6.5 6.5 overall balance -3.4 -4.7 -5.5 5.5r -6.0 -5.0 -5.0 financing 3.4 4.7 5.5 5.5r 6.0 5.0 5.0 domestic financing 0.7 1.2 1.3 2.0r 2.5 2.1 2.1 external financing (net) 2.8 3.5 3.9 3.5r 3.5 2.9 2.9 money and credit (year-on-year % change) domestic credit 11.2 14.7 12.3 14.0 17.2 18.5 18.3 10,750 10,912 10,364 15,365 21,508 25,025 30,168 33,493 32,943 32,717 36,037 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 trends in foreign exchange reserves year (end june) total reserves (million usd) south asian review of business and administrative studies vol. 3, no. 2, dec 2021 136 credit to the private sector 15.7 16.9 11.3 8.6 16.7 16.8 16.8 broad money (m2) 10.9 9.2 9.9 12.7 12.5 12.5 12.5 external sector exports fob (% change) 1.7 6.7 9.2 -17.1 15.0 10.8 11.0 imports fob (% change) 9.0 25.2 1.8 -8.6 10.0 8.0 7.0 remittances (% change) -14.5 17.3 9.6 10.9 15.0 10.0 10.0 current account balance (% of gdp) -0.5 -3.5 -1.7 -1.5 0.1 0.4 0.8 gross foreign exchange reserve (billion usd) 33.5 32.9 32.7 36.0 40.2 45.0 50.0 forex reserve in months of import 6.6 6.0 6.5 6.4 8.8 9.1 9.5 memorandum item gdp at current market prices (billion bdt) 19758 .2 22504 .8 25424 .8 27963. 8 31718 3583 4 40456 r according to revised budget for fy 20. source: bangladesh economic review, 2020, mof. bangladesh's remittance income opportunities up till june 2021, bangladesh received a record amount of remittances of about $ 46.39 billion (ber-2021). forex reserves has reached at us$ 36.04 bill. on june 30, 2020. the forex reserve stood at us$ 32.72 billion on june 30, 2019. the foreign exchange reserves had increased to usd 46.39 billion by the end of june 2021 (ber-2021). bangladesh sent the second-largest number of employees to the middle east countries (moew&oe, 2020). the demand for blue-collar employees in asian countries, especially in middle east, has been reported to be increasing on a daily basis. qatar will host the 2022 world cup of football. as a result, the government of this country wishes to import a large number of bangladeshi workers. as a result, bangladesh government should promptly initiate diplomatic discussions with qatar in order to capture this country's labor market and generate a large amount of foreign remittance. aside from that, the government has to take the necessary steps to open kuwait's labor market to new bangladeshi migrant workers as soon as possible, as well as hold bilateral and multilateral discussions with other middle eastern countries to assist the government in expanding the labor market in the region. malaysia has recently agreed to accept bangladeshi labor. the government is now attempting to collect the needed number of competent laborers through a popular campaign in every bangladeshi district. in this scenario, the government must exercise extreme caution to ensure that bangladesh migrants are not denied access to the malaysian labor market. aside from malaysia, the bangladeshi government should seek bilateral and multilateral talks with governments in other asian and middle eastern nations to ensure that our migrants have a better chance there. a major element driving rising demand for skilled labor is the unavailability of some trained workers in industrialized countries, such as information technology professionals and computer specialists, nurses, and medical physicians. over the last few years, the oecd countries focus on high-skilled immigration through special visa programs like it experts in germany, express entry in canada, h-1b in usa and so on. bangladeshi government need to focuses on a major priority on boosting skill of potential migrants through a range of training programs so that bangladeshi migrants can migrate to any countries. wealthy countries governments are now paying special attention to the continent's diverse countries' development. as a result, the government of bangladesh should begin bilateral and multilateral talks as soon as feasible so that bangladesh can export a large amount of labor to other african countries. furthermore, government should take diplomatic initiate and discussions with latin american with the governments, as assure to export human resources to prospective countries. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 137 bangladeshi migrants' struggles bangladeshi migrant workers have contributed significantly to the economy, benefiting government by growing employment, forex reserves, and contribution to bop. however, both inside and outside the country, these migrant workers are constantly confronted with a number of challenges. bangladeshi migrants face many problems both inside and outside of the nation. people who desire to work in another country face an information challenge because the majority of them are illiterate and have no idea where to get more reliable information. people who desire to work in another country face financial difficulties because the vast majority of them are impoverished and lack sufficient resources. however, in bangladesh, the non-government cost of migrating is quite high, making it nearly difficult for these poor individuals to bear. people who desire to work in another country have an efficiency difficulty because the majority of bangladeshi migrant workers are untrained or low-skilled. migrants from bangladesh face a lack of training. they do not receive any pre-departure training from private or government recruiting firms. migrants in bangladesh are frequently confronted with passport collecting issues, as a result of the adoption of machinereadable passports. bangladeshi overseas workers are frequently subjected to emergency situations such as cheating, fraud, and other forms of deception both inside and outside the country. migrant workers in bangladesh frequently face difficulties sending remittances through normal channels, particularly to distant areas of the nation, because of complicated and long procedures. at bangladesh's several airports, bangladeshi migrants are frequently harassed and, in some cases, physically attacked. bangladeshi migrant workers face investment challenges on a regular basis as a result of the country's turbulent political environment. bangladesh's current pre-departure regulation is ambiguous and convoluted, posing significant difficulties for migrants. policy recommendations bangladesh's government has been using remittance money to pay different official and nongovernment import expenditures, as well as installments on various international debts and gifts. remittances have also helped to enhance the country's foreign exchange reserves, per capita income, and job prospects. as a result, the government should adopt some steps to save bangladesh's major revenue-generating sector as recommended the government should create information booths or centers around the country in union, upzila, and zila parishad in order to ensure of required and relevant information, also create comparable possibilities and amenities in countries where migrant workers are working. people's problems would be alleviated if the government could provide these possibilities and facilities for migrant workers both inside and outside the country. this would build trust and confidence in the government. the government should establish a set amount as an expense that migrant workers must submit to recruiting agencies, and it should apply to both commercial and public recruiting firms. in addition, the government may provide financial aid and bank loans to migrant workers. additional worker taxes, on the other hand, should be eliminated by the government. before travelling abroad, the government should establish a variety of training and learning facilities where migrant workers may learn about language, culture, customs, values, conduct, working and geographical surroundings, and other topics. private recruiting firms must also build various training and learning institutes in order to prepare their sending personnel for pre-departure training. the government and commercial recruiting firms should send competent workers abroad to compete and survive in the workplace with migrant workers from other countries. the government south asian review of business and administrative studies vol. 3, no. 2, dec 2021 138 should make a rapid decision to give passports to specific villages or districts on a specific day or at a specific time. the cost and time required to obtain a passport would be minimised if the government could distribute passports from each village or district on a set day or time. to make the procedure easier, the government may use information technology. the government should establish emergency phone numbers and services for migrant workers both inside and outside the country, and make it mandatory for them to seek assistance. the banks should improve their services across the country and reduce the amount of paper work and documentation required, making it very simple and easy for migrant workers. those who participate in illicit operations in the country's airports should face legal consequences, according to the authorities. to utilize remittance in the different productive sector, the government should create an investment-friendly climate. otherwise, the migrant workers' family members and relatives will spend a big portion of the remittance money on consumption. the government should draft clear and explicit pre-departure laws for migrant workers to comprehend, as this will encourage them to comply. due to a lack of information, experience, and education, migrant workers encounter numerous challenges while working abroad. in order to address this issue, the government authority and private recruiting agency should extend their training centers around the country. return employees may be able to help prospective workers by offering fundamental knowledge and manner. concluding remarks manpower exporting is one of our country's most important foreign currency generating businesses. many variables have influenced the flow of remittances, both directly and indirectly. competition is one of the most important direct variables. many countries send labor to other countries. as a result, bangladeshi migrant laborers in the foreign area must compete fiercely with workers from other countries. for example, in order to safeguard bangladesh's crucial incomegenerating sector, the government should pay special attention to strengthening workers' abilities and taking the necessary steps to establish mutual trust and good relations with diverse countries around the world. references accounts & budgeting department, b. b. 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(2014). remittances as an economic development factor. empirical evidence from the cee countries. procedia economics and finance, 10, 54–60. https://doi.org/https://doi.org/10.1016/s2212-5671(14)00277-9 south asian review of business and administrative studies vol. 3, no. 1, june 2021 63 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.1, june 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas linking the customer knowledge management with software quality: an empirical study of software development organizations in pakistan aamna hanif, research scholar, comsats university islamabad, pakistan amir rafique, assistant professor, comsats university islamabad, pakistan muhammad umer quddoos, assistant professor, department of commerce, bahauddin zakariya university, pakistan article details abstract history revised format: may 2021 available online: june 2021 keywords customer knowledge management (ckm), enterprise software (es), crm technology infrastructure, pakistan, software quality the research aimed to enhance customer knowledge management (ckm) which has a high impact on the quality of software products. in enterprise software (es) development the customer knowledge management is still immature. this raises the question of how ckm enablers can be used to help es development companies improve the quality of software. the results of the study showed that ckm enablers can help to improve the quality of software products in pakistan. framework for ckm can help software development organizations to improve software quality as well and will also reduce cost and gain market reputation with competent trained resources. results showed that "customer involvement" with "trust" was the most influential factor, followed by "crm technology infrastructure" and "cross-functional co-operation". furthermore, "there was no impact from the organizational training”, "customer knowledge map", and" ckm strategy development". the impact of ckm on software quality is significant. the results of the study also highlighted all the potential factors that are beneficial in influencing the ckm for quality improvement of es in pakistan. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: umerattari@bzu.edu.pk doi: https://doi.org/10.52461/sabas.v3i2.496 introduction with the increase in the negotiation power of consumers and the emergence of the information economy, the approach of doing business and managing customer markets in organizations has modified considerably. the knowledge about the customers and its management in organizations are getting important to sustain business in the future. al-shammari (2009) emphasizes that customer knowledge management (ckm) allows organizations to create distinctive core competencies by attaining information related to customers. ckm has attained extensive popularity withinside the past decade and is stated in each enterprise and educational field (gibbert et al., 2002; su et al., 2006; chenand su, 2006; deloitte, 2012; mukherji, 2012; wilde, 2011; kankanhalli and lee, 2011; paquatte, 2008;). the literature has emphasized the necessity for the https://journals.iub.edu.pk/index.php/sabas mailto:umerattari@bzu.edu.pk https://doi.org/10.52461/sabas.v3i2.496 south asian review of business and administrative studies vol. 3, no. 1, june 2021 64 universal view of clients in organizations (smalley, 2000; greenberg, 2009; pockard, 2009; deloitte,2012; shannak et al., 2012). however, there may be an enormous lack of literature concerning the way to attain customer knowledge (salomann et al., 2005; zanjani et al., 2008; pockard, 2009; liautaud, 2010). customer knowledge management (ckm) is rapidly becoming a significant factor for the competitiveness of an organization. as a result, more and more research is being conducted in this field (wang, 2015). optimal ckm benefits an organization in terms of services/products quality enhancement while decreasing the service/production costs. however, concerning organizations in pakistan, it is easier said than done. there are various challenges faced by an organization seeking to fully implement ckm. specifically, there exists a research gap on the effectiveness and direction of deploying certain human, technological, and organization level factors for the management of customer knowledge to meet customer requirements (korhonen et al., 2016). customer-centric processes along with customer knowledge management are being recognized by practitioners and analysts as very important for organizations to sustain in progressively competitive international markets (gibbert, 2002; stefanou et al., 2003; al-shammari 2009; deloitte, 2012). ckm encompasses ‘knowledge for customers’, ‘knowledge about customers’, and ‘knowledge from customers.’ practicing ckm efficiently and effective has major implications for organizations. rollins and halinen (2005) suggest that ckm competency ought to involve the subsequent 5 areas: 1. inter-functional cooperation 2. adjunct organizational systems 3. cooperation with customers 4. adjunct it systems 5. organizational culture that supports learning and client orientation. research conducted in the area of software quality enhancement indicates that they are mostly focused on functional and non-functional aspects of software products as quality measures (cho et al., 2013). therefore, there is customer knowledge management research needed in software development organizations of pakistan. according to (association for project management, 2006) it can be unanimously declared that customers are vital among all the stakeholders of a project. and it is plausible that customer satisfaction and resultantly project success can be increased manifold if customer interaction in terms of collaboration and communication is increased in any software development life cycle (sdlc). there are a lot of organizational challenges involved in the process of implementing and practicing ckm. smith and mckenn (2005) found challenges of organizations that can be structural, cultural, and related to competencies, and as per desouza and awazu (2005), these are of integration, segmentation, distribution, and application. there is significant work published emphasizing ckm (salomann et al, 2005; zanjani et al, 2008; pockard, 2009; liautaud, 2010). customer knowledge management can also be utilized to get development phase-wise feedback from customers and then application of this feedback for further process improvement. since there is a lack of ckm integration in software development for quality improvement and developed framework to use ckm in this industry is not available. further exploration is also required to check the impact of ckm utilization specifically for software quality improvement (zhang, 2011). the current research aims to enhance customer knowledge management (ckm) which has a high impact on the quality of software products. in enterprise software (es) development the customer knowledge management is still immature, the research aims at how the ckm enablers can help to improve the quality of software products in pakistan. south asian review of business and administrative studies vol. 3, no. 1, june 2021 65 research objectives the objectives of the study are as follows: 1. to identify the factors that have an impact on customer knowledge management (considering technological, organizational, and human) in software organizations. 2. to focus on ranking all the possible factors that can be beneficial in influencing the customer knowledge management for quality improvement of enterprise software in pakistan. literature review customer knowledge (ck) is the mixture of perception, experience, and value that is gained during the interaction between customer and organizations (gebert et al., 2002). however, customer knowledge management (ckm) refers to gaining, sharing, and utilizing ck for the benefit of not only customers but also the organization. whereas knowledge is perceived in two distinct ways by rationalism and empiricism (nonaka & takeuchi 1995; kandadi, 2006). management is a process of planning, organizing, controlling processes to achieve goals (daft, 2010; schermerhorn, 2005). this study follows the definition “management is defined as the accomplishment of organizational goals effectively and efficiently through planning, organizing, leading and controlling organizational resources” by daft, 2010. the scope of customer information contains not only 'customer information' and 'customer information but also 'customer information' (salomann, et al., 2005; zanjani et al, 2008; akhavan & heidari, 2008). al-shammari (2009) underscored a new division that is a combination of information and customers. gibbert et al. (2002) emphasize the importance of the customer as a source of new product development and also emphasize the term 'prosumer' (customer as a producer and consumer). with the onset of the information economy, the emphasis has shifted from land, labor, and the head of knowledge. information economics is based directly on the use of information and knowledge (oecd 1996). information is not only an important asset to organizations but also explains what is important for growth. within the economic challenges that underpin knowledge lies in the production of information that falls within the scope of knowledge management (beijersy, 1999). information management as a discipline has attained much popularity over the past two decades. ckm is advantageous to both organizations and clients (davenport et al, 2001; gibbert et al, 2002; garcia-murillo and annabi, 2002). effective ckm will allow organizations to create existing products and expand products/ services. effective ckm will allow you to capture customer purchasing behavior and highlight features that perform a crucial role in customer decisionmaking. ckm focuses on customer satisfaction which subsequently promotes customer loyalty. knowledge-based view theory (kbv) knowledge management plays a very important role on which the success of an organization depends. in knowledge management, information has been identified, stored, collected, and shared with individuals within an organization. (noel ransom) knowledge-based view theory of firm performance attracts the attention of many scholars in the arena of economics, organizational theory, and strategic management in the last decade. in 2007, lin presented a knowledge management framework that supports knowledge-based view (kbv) theory. according to kbv, the performance of firms depends upon their members who improve the organization’s knowledge area and implement it to produce high-quality products and services (grant, 1996). framework enablers are categorized into three factors: human, organizational, and technology. these are used to develop individual, technological, and organizational capabilities to enable effective km in the firms. the processes are used to collect, share, apply experiences and expertise in the organization. the outcomes are used to achieve the organization’s performance and product south asian review of business and administrative studies vol. 3, no. 1, june 2021 66 quality. this study is about automation software testing (ast) implementation by using kbv which undertakes that knowledge is maintained by individuals, not by organizations (grant, 1996). ckm framework the generic knowledge management framework involves 3 basic features: enablers, processes, and outcomes. the enablers can be further categorized into human, organizational, and technology (lin et al., 2007). where the role of enablers is to facilitate km (knowledge management) in the organization by developing and improving the capabilities of personnel, organization, and technology (lin et al., 2007). the processes about the collection of customers’ knowledge, sharing, and application of knowledge gained within the organization. and the results will depict the level of km effectiveness in organization performance. human organization technology enablers dimension processes dimension outcomes dimension figure 1: the generic framework of customer knowledge management processes customer knowledge management enablers are the critical aspects to activate ckm, by removing hurdles of ckm, and providing organizational, human, and technical support to ease ckm implementation (khosravi et al., 2014). in 2010, a study categorizes the customer knowledge management process into four major phases. in the first phase, customer knowledge is acquired, in the second phase ck is stored in the system, in the third phase the acquired and stored ck is shared among others and finally, in the fourth and last phase, this knowledge is utilized by the application. the desired outcomes of ckm are improved products/services quality and hence the organization’s efficiency (hammami et al., 2011). this refers to the capability of an organization to better understand a customer’s needs and requirements and improve its performance to gain customer satisfaction. here it can be inferred that quality of product/service is the main desired ckm outcome. however, in software development organizations, the consequence of ckm on product quality is not much explored and researched. hypothesis development based on the aspects that affect ckm and software quality rapport (khosravi et al., 2017), research is conducted on 10 hypotheses as mentioned below: figure 2: research model south asian review of business and administrative studies vol. 3, no. 1, june 2021 67 hypothesis 1: there is a positive and significant relationship between personnel skills and capability and ckm in software development organizations. hypothesis 2: there is a positive and significant relationship between customer-company trust and ckm in software development organizations. hypothesis 3: there is a positive and significant relationship between customer participation and ckm in software development organizations. hypothesis 4: there is a positive and significant relationship between customer-focused culture and ckm in software development organizations. hypothesis 5: there is a positive and significant relationship between senior management willingness and support and ckm in software development organizations. hypothesis 6: there is a positive and significant relationship between employee training and ckm in software development organizations. hypothesis 7: there is a positive and significant relationship between customer relationship management technology and ckm in software development organizations. hypothesis 8: there is a positive and significant relationship between collaboration systems and ckm in software development organizations. hypothesis 9: there is a positive and significant relationship between organizational knowledge flow and ckm in software development organizations. hypothesis 10: there is a positive and significant relationship between ckm and software quality in software development organizations of pakistan. research methodology based on the ckm literature, the research model is developed. figure 3: research design framework the research study follows quantitative choice. in a quantitative study, the analysis is made based on survey results. the study collects primary data from 270 respondents through a selfadministered questionnaire distributed in software development organizations, as the emphasis of the research is to enhance the software quality through ckm. the respondents in this study are the persons working in software organizations either at the senior management level, in quality department, or who deal with customer requirements. in this research study, we use convenience sampling which lies in the non-probability sampling technique. after collecting the data, we use spss and smart pls for data analysis. we use pls-sem for the data analysis. pls-sem suggests define research problem and objectives extract the ckm enablers ranking the ckm enablers develop research on the basis of high priority ckm enablers and ckm framework analyze survey data and finalizing the model south asian review of business and administrative studies vol. 3, no. 1, june 2021 68 considerable potential for examining large datasets, including secondary data that often do not include full marking on the wealth of measurement theory (hair, sarstedt, & ringle, 2019). data analysis the present study collects data from the software companies of pakistan. the respondents are those who involve in handling customer inquiries, software developers, engineers, team leads, and are highly informed about the ckm and quality. maximum outreach to employees of the companies was done by sending the google survey form via email. the respondents were asked thirty-eight questions and the questionnaire was divided into eleven parts. five out of thirty-eight questions are about the demographics of the respondents. thirty-three out of thirty-eight (86 %) questions are valid with the analysis of ckm. for the data collection phase, companies hr and administration sections are contacted who are registered with the software technology board. the data analysis was done as suggested by hair et al. (2013). the two phases proposed are an examination of the measurement model regarding the validity, reliability, and a structural model. the overall reliability and cronbach's alpha values are above 0.7. in addition, all ave values are above the limit of 0.5, which shows that there are no tolerance issues. table 1 includes (1) path coefficients (2) the corresponding t-values of the paths (3) the p-values. the pls approach, used in this study, is consistent with previous studies (lin et al., 2012). table 1: model summary hypothesis path coefficient t-value p-value results h1 0.14261 2.650352 0.018649 supported h2 0.171132 2.443019 0.029619 supported h3 0.198557 2.984937 0.007679 supported h4 0.123961 2.767731 0.014261 supported h5 0.110797 2.893886 0.009873 supported h6 0.161259 2.399139 0.03291 supported h7 0.166744 2.576853 0.02194 supported h8 0.157968 2.730433 0.015358 supported h9 0.690013 12.60014 0.014 supported h10 0.176901 2.631855 0.036102 supported the research has increased over the years related to ckm that also indicates its importance in companies and professional organizations. although a lot of research is underway in ckm still gap was identified in the ckm enablers. considerable data was selected from the publications between the period 2010-2020 where antecedent factors were obtained. it was noted that all the articles published used the survey method to conduct research. the results showed that the antecedent factors are mostly customer-centric culture while the highest frequency in literature was seen for “organizational culture” and the least frequency was observed for “trust between customer and company”. the frequency table is listed below. table 2: the ckm frequencies ckm antecedent factors frequency collaboration system 29 competencies and skills 25 crm technology infrastructure 29 cross-functional cooperation 14 south asian review of business and administrative studies vol. 3, no. 1, june 2021 69 customer involvement 12 customer knowledge management (ckm) 28 organizational culture 38 senior management support 18 software quality 20 training 17 trust between customer and company 5 ranking ckm for quality improvement was also a key objective of the study. the study took guidance from the published work of (khosravi et al. 2017) where he developed a theoretical model for ckm based on twenty-two antecedent factors of ckm. these factors were extracted from the literature in his study. based on the assumptions of this model and the addition of newly published research from literature, ranking on ckm antecedent factors was made using the same guidelines and are depicted in table no. 3. table 3: ranking of ckm antecedent factors factors ranking collaboration system 0.79 senior management support 0.68 organizational culture 0.36 crm technology infrastructure 0.22 customer knowledge management (ckm) 0.19 training 0.64 competencies and skills 0.50 customer involvement 0.42 cross-functional cooperation 0.37 software quality 0.19 trust between customer and company 0.06 human factors that include two sub-factors i.e., competencies and skills & ii) trust was analyzed. among the respondents, 43 % agreed that human factors are important for ckm and overall software quality. while 13 % disagree with the fact that the two factors in human factors are important for improvement in software quality. the results of human factors are shown in figure 4. figure 4: figure showing the percentage response received on the questions of human factors. south asian review of business and administrative studies vol. 3, no. 1, june 2021 70 technological factors group includes crm technology infrastructure and collaboration system. the response received for the two factors showed that 34 % of the survey was agreed to the stance that technological factors contribute to software quality with 31% of respondents remaining neutral and 14 % disagreeing with the fact that technological factors contribute to software quality. the output of the technological survey section is shown below in figure 6. figure 6: figure showing the percentage response received on the questions of technological factors. the importance of ckm is a well-established fact for product quality. the survey was included with 04 questions from ckm taken from the already published studies. it was seen that 38 % of the respondents agreed to the fact that ckm is a vital part of enhancing product quality/ software. 31 % of the respondents remained neutral. the results of ckm are shown in figure 7. figure 7: figure showing the percentage response received on the questions of ckm. the respondents were given specific questions on the quality of the product/software. figure 10 shows the responses received in this regard. 38 % agreed to the fact that software quality is dependent on the customer’s feedback as they are the end-users of the product and can demonstrate its reliability, strengths, and weaknesses. 19 % of the responses were received as neutral and 14 % were in disagreed/strongly disagreed with this fact. south asian review of business and administrative studies vol. 3, no. 1, june 2021 71 figure 8: figure showing the percentage response received on the questions of software quality. conclusion and recommendations ckm and software quality interrelationship is well known and reported by many studies conducted in the past. these studies remained specific to the software development industry. pakistan is also one of the newly emerging leaders in the software development sector of the world as of now hundreds of companies are providing quality services to the world’s leading companies and organizations. as no study on ckm to date has been reported in the literature for pakistan, an effort was done to report the relationship of ckm, and software quality based on many hypotheses as detailed in the above chapters. the study at the start took into consideration literature reported in well-known publishing agencies. this helps us to align the scope of the study in a manner effective and objective-oriented. the study was designed with a questionnaire-based which was taken from the literature review and each question was designed to best explain the research hypothesis. the main contributing factor of the research was defined as ckm for the quality enhancement of software. the designed questionnaire was subdivided into different sections and each sech section response was recorded. the designed questionnaire was circulated through emails, whatsapp, and other social media sources to help us reach the sample size of 270 responses. the questionnaire forms were developed using online google forms which were self-gathered by the software. the data obtained from the google forms were extracted in an excel sheet which was analyzed for statistical analysis using ms-excel, pls, and spss. the results obtained and analyzed showed significant results towards the relationship of ckm and software quality. the first of the contributing factor i.e. human factors showed that the ckm has a significant impact on the development of software. skotis et al. (2013) in their study reported the same as our results that the relationship between personnel skills and capability and ckm in software development organizations has a significant impact to improve software quality. the second was organizational factors that include i) customer involvement ii) organizational culture, iii) cross-functional cooperation, and iv) senior management support training. lorenzoromero et al. (2014) in his study reported similar results that interactive data can be generated more easily when the company is practicing higher customer involvement. the results show that technological factors contribute to software quality. studies. garridomoreno et al. (2014) suggested in their research that crm systems are very effective in enhancing software quality through ckm. our study is in line with the findings of khosravi et al. (2017) where ckm has a positive relationship with the quality enhancement of software. the findings support our argument and hence can be concluded that ck is a key attribute that can help improve product quality. skotis et al., 2013, reported that ckm and software quality are interdependent factors and positively relate to the improvement of the quality of software. the results of human factors further confirmed that there is a significant relationship between personnel skills and south asian review of business and administrative studies vol. 3, no. 1, june 2021 72 capability and ckm in software development organizations. similar findings were reported by stefanou et al. (2003), vaezitehrani (2013), and skotis et al. (2013). the researchers studied that if the customer involvement is high, there becomes self-generating interactive data which helps to improve product quality. these results were also reported in previous studies. the fact is a widely accepted truth that top management support can help the successful implementation of ckm. our study results are also depicted by previous studies conducted by (attafar et al., 2013; campbell, 2003). for the relationship between employee training and ckm in software development organizations, our findings are different from the findings of khosravi et al. (2017). furthermore, salojärvi et al. (2010) found similar results in their studies where they suggested that crm is one of the necessary to support ckm. this hypothesis was also in line with the previously conducted studies by mukherji (2012). conclusions the conclusion of the study is elaborated under a flowchart in figure 9. figure 9: conclusion of study shown as a flowchart. i. the results confirmed that 03 factors i.e., human, technological, and organizational have an effective impact on ckm. ii. ckm and software quality showed a significant relationship. iii. the results confirmed and supported the generic customer knowledge management framework. recommendations and future directions following are the recommendations and future directions made from the research conducted: i. future studies on ckm may be conducted on a company-specific model rather than go for many. this is helpful to investigate ckm on the software quality of the company. ii. customer knowledge management (ckm) based policies and strategies shall be proposed to help companies to reduce the risk of ckm. iii. the study was designed to consider the most important factors of ckm needed for enhancing software quality, while many other factors were not considered because those factors have shown non-significant effects between ckm and software quality. the missing/ignored factors can be reinvestigated to see the difference of effects regionally for software quality improvement by ckm. iv. the results of the study are generalized since the questionnaire was sent to individuals. while for a more specific approach ckm & software quality relationships shall be checked for individual companies of any size. v. the study is focused on one contributing factor i.e. ckm, where different constructs were established to see the impact on software quality. such studies can be replicated to other contributing factors in other engineering and non-engineering sectors. south asian review of business and administrative studies vol. 3, no. 1, june 2021 73 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studies vol. 3, no. 1, june 2021 1 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.1, june 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas impact of investment and dividend decisions on financing decisions: evidence from pakistan asifa maqbool, department of management sciences, comsats university islamabad, pakistan nadeem ahmed sheikh, institute of business, management and administrative sciences, the islamia university of bahawalpur, pakistan article details abstract history revised format: may 2021 available online: june 2021 keywords financing, investment, dividend, ols, fixed effect, random effect, pakistan, raising funds efficiently for the operations of the firm is considered a very important decision. since 1960’s and after the emergence of different capital structure theories, many empirical studies have been conducted to determine the factors affecting the capital structure decisions. but the evidence regarding corporate investment and dividend decisions as determinants is limited and mixed. empirical evidence from emerging economies is limited and this area is largely ignored. this study has mainly focused on the impact of corporate investment and dividend decisions on financing decisions of the firms in emerging economies. the panel data of non financial firms listed in pakistan stock exchange is used. panel data techniques i.e. ols, fixed effect and random effect are used to estimate the results. the study also controls for the impact of profitability, size, liquidity and market to book ratio on the financing decisions. findings showed that investment is strong negative determinant of financing but dividend is irrelevant to the financing decisions. profitability, liquidity and size of the firm have negative effect on leverage while growth opportunities has positive effect. he results have proved the application of pecking order theory in the context of pakistan. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: asifamaqbool@cuivehari.edu.pk doi: https://doi.org/10.52461/sabas.v3i1.530 introduction modern corporate financing ideas are founded on modigliani and miller's (1958) work. they contend that in an efficient market with no taxes, bankruptcy fees, transaction costs, or information asymmetries, a company's worth is unaffected by how it is financed. in other words, a company's financing selections have no bearing on its worth. corporate financing behaviour is hotly discussed in corporate finance literature. following modigliani-irrelevance miller's premise, the research focused on how real-world defects affect the perfect market and how these market imperfections make corporations reliant on their financial decisions. however, myers and majluf (1984) and myers (1984) documented the market imperfections due to information asymmetry in the capital https://journals.iub.edu.pk/index.php/sabas mailto:asifamaqbool@cuivehari.edu.pk https://doi.org/10.52461/sabas.v3i1.530 south asian review of business and administrative studies vol. 3, no. 1, june 2021 2 market. jensen and meckling (1976), bernanke and gertler (1990) demonstrated that due to conflict of interests and costly monitoring of managerial actions external finance providers demand high rate of return, so external finance is costly than internal finance. the investment decisions of the firms operating in such environments are affected by how the projects are financed. due to information asymmetry different theories emerge that support capital structure decision relevance proposition. agency theory (jensen & meckling, 1976), pecking order theory (myers & majluf, 1984), signalling theory (bhattacharya, 1979), and trade of theory are some of the theories that have been proposed (myers, 1984). dhrymes and kurz (1967), mccabe (1979), and partington (1985) discovered that corporate finance, investment, and dividend decisions are interrelated and support the relevance of financing decisions. mm theorems were called separation principles by fama and miller (1972). hamid and singh (1992) were one of the first studies to look at the financing behaviour of enterprises in developing economies, such as pakistan. they came to the conclusion that major companies in poor countries are more prone to debt than those in wealthy countries. according to booth, aivazian, demirguckunt, and maksimovic (2001), developing-country enterprises have higher short-term debt in their capital structure than developed-country firms. most empirical studies of capital structure determinants have traditionally focused on firm-specific variables such as titman and wessels (1988), rafiq (2008), gurcharan (2010), ahmed sheikh and wang (2011), masnoon and saeed (2014) and sakr and bedeir (2019). but evidence on the impact of corporate investment and dividend decisions on financing decisions is very small. this area of research is largely ignored in emerging economies. this study intended to give empirical data on the impact of corporate investment and dividend decisions on non-financial enterprises listed on the pakistan stock exchange's financing behaviour. profitability, size, liquidity, and market to book ratio all have an impact on financing decisions, according to the research. the following are the remaining sections of the paper. the second section contains a review of the literature on the factors that influence capital structure. the data sources and technique are discussed in section 3. after that, there will be empirical results and a debate. the conclusion is found in section 5. literature review many empirical research have been done to determine the elements that influence a firm's capital structure. rajan and zingales (1995) conducted a study on a sample of enterprises in developed nations, attempting to understand the factors affecting the capital structure of firms in developed countries. booth et al. (2001) investigated the factors that influence the capital structure of enterprises in developing nations. the following are some of the aspects that can influence your debt or equity decision. size according to the pecking order idea, as businesses grow, they earn greater revenues and can thus use internally generated cash rather than seeking debt. the negative link between leverage and business size is predicted by the pecking order theory. contrary to pecking order theory predictions, trade off and market timing theories suggest that large firms use more debt than small enterprises because of the interest tax benefits that large firms receive. furthermore, the free cash flow hypothesis predicts that large companies will employ debt to offset the increased agency costs caused by the availability of free cash flows. the research on the relationship between business size and leverage is contradictory. rajan and zingales (1995) looked at the factors that influence non-financial enterprises' capital structure in g7 countries. the author discovers that most countries have a positive link between business size and leverage, with the exception of germany, where leverage and firm size have a south asian review of business and administrative studies vol. 3, no. 1, june 2021 3 negative association. ahmed sheikh and wang (2011) investigated the elements that influence leverage in pakistan's manufacturing industry. the study's findings imply that firm size has a beneficial impact on debt ratio. empirical evidence is also provided by fama and french (2002), antoniou, guney, and paudyal (2008), ahmed, ahmed, and ahmed (2010), lemma and negash (2014), and sakr and bedeir (2019) in support of a positive company size and leverage relationship. titman and wessels (1988), wald (1999), chen (2004), ab wahab and ramli (2014), and acaravci (2015), on the other hand, discovered a negative association between leverage and firm size. profitability theoretical predictions concerning the profitability-to-leverage connection are inconclusive. according to the pecking order idea, corporations prefer internal finance to debt (myers & majluf, 1984). as a result, more lucrative businesses have more internal money and fewer external funding needs. myers and majluf (1984), titman and wessels (1988), rajan and zingales (1995), nijenhuis (2013), acaravci (2015), and thalib, herdiyana, and wahid (2019) all found that profitability and leverage have a negative connection. more profitable enterprises, according to trade-off theory, should have more debt since they have more money to take advantage of the interest tax break. more profitable corporations should employ more debt to minimise the agency costs raised by the abundance of free cash flows, according to the free cash flow model. some research have found a link between profitability and debt (fattouh, scaramozzino, & harris, 2002; selfiani, 2013). asset tangibility the majority of capital structure theories show that the sort of assets a company possesses has a significant impact on its capital structure. according to trade-off theory, asset tangibility and leverage have a positive relationship. tangible assets have a higher collateral value, allowing businesses to borrow more money. tangible assets will also lower the cost of financial crisis. titman and wessels (1988), rajan and zingales (1995), frank and goyal (2003), zabri (2012), and iqbal, ahmad, and ali (2019) all found that asset tangibility has a beneficial impact on leverage. in contrast to the trade-off approach, the agency theory implies that tangibility and debt have a negative relationship. booth et al. (2001) used data from ten developing nations, including pakistan, to analyse capital structure. the study's findings support the theory that asset tangibility and leverage have a negative connection. abor (2005) and masnoon and saeed (2014) both found a negative association between asset tangibility and leverage in their empirical studies. growth opportunities growth prospects are positively associated to company leverage, according to pecking order theory. growing businesses may require outside financing if their internal funds are insufficient. when it comes to external financing, the pecking order hypothesis predicts that enterprises will choose debt to stock. as a result, growth prospects and leverage are linked. the positive leveragegrowth link was supported in empirical research by ahmed et al. (2010), ahmad and abbas (2011), and thalib et al. (2019). the negative association between growth and leverage was discovered by rajan and zingales (1995), fama and french (2002), antoniou et al. (2008), and frank and goyal (2009). the trade-off theory explains why there is a negative association. firms with larger growth potential, according to trade off theory, issue equity rather than debt to prevent stockholderbondholder agency conflict, which can lead to underinvestment. non-debt tax shield the fundamental advantage of debt financing, according to trade-off theory, is that interest payments are tax deductible and provide a tax shelter. depreciation, often known as non-debt tax shield, is another item that provides tax relief. according to pecking order theory, the non-debt tax south asian review of business and administrative studies vol. 3, no. 1, june 2021 4 shield is inversely proportional to debt. non-debt tax deductions, according to titman and wessels (1988), are a substitute for debt tax shelter, hence firms with a high non-debt tax shield are likely to have less debt in their capital structure. the majority of empirical studies demonstrate that nondebt tax shelter and leverage have a negative association (mackie-mason, 1990; schargrodsky, 2002; zabri, 2012; and acaravci, 2015). selfiani (2013) and thalib et al. (2019) confirmed that the non-debt tax shield has no effect on leverage. dividend policy the firm's dividend policy has an impact on the debt and equity options available. the relationship between dividend policy and capital structure can be described using signalling theory, which states that higher payouts send a favourable signal to investors about the firm's future earnings. as a result, the cost of equity will be reduced, putting equity ahead of debt. this suggests that dividends and leverage have an adverse relationship. the negative link between dividend and leverage has been empirically proven by rozeff (1982), antoniou et al. (2008), and lemma and negash (2014). firms with high dividend payout ratios, on the other hand, are more inclined to borrow when the dividend tax rate is higher than the capital gain tax rate, according to chang and rhee (1990). data and methodology data data was collected from non-financial enterprises listed on the psx (pakistan stock exchange) and published by the state bank of pakistan to discover the factors that drive corporate funding. for the analysis, a balance panel of all non-financial enterprises from 2013 to 2018 was used. there are 1752 firm-year observations in the final sample. description of variables the proxies for all the variables are provided in table i to empirically quantify the impact of corporate investment and dividend on corporate financing decisions. table i. description of variables dependent variables financing decisions fin total liabilities/total assets explanatory variables investment decisions inv operating fixed assets/total assets dividend decisions div dividend per share control variables size sz natural log of total assets profitability pro profit after tax/total assets liquidity liq current assets/current liabilities growth opportunities go market price per share/book value per share methodology this study's data set is organised as a panel, with cross-company and time-series observations. the panel data set greatly expands the sample size and is superior for studying change dynamics south asian review of business and administrative studies vol. 3, no. 1, june 2021 5 (ahmed sheikh & wang, 2011). in empirical corporate finance research, panel data is preferable to pure cross sectional and pure time series due to its rich structure. the drivers of business finance decisions were determined using three estimate models: ordinary least square (ols), fixed effect, and random effect. the hausman (1978) test is used to determine whether a fixed effect or random effect model should be utilised. the basic regression model is shown in the diagram below. itit6it5it4it3it2it10it εgoβliqβproβszβinvβdivββfin +++++++= where it fin = financing decisions of firm i at time t it inv = investment spending of firm i at time t it div dividend of firm i at time t it sz = size of firm i at time t it pro = profitability firm i at time t it liq = liquidity of firm i at time t it go = growth of firm i at time t it  = error term, 0  = y-intercept, 61  − = coefficients of concerned explanatory variables empirical results and discussion descriptive statistics summary statistics of the variables are presented in table ii. the average value for investment is 44.5% which indicates the proportion of operating fixed assets employed by the firms. the average value of financing is 56.8% which shows the 56.8% of total assets are financed with total liabilities. the results shows the firms have high debt ratio. it is due to the negative equity of the firms which are included in the study. the negative equity is because of accumulated losses not because of negative paid in capital. the average value of dividend per share is rs.0.80. this value is less than one rupee showing that most of the firms in pakistan are not paying dividends frequently. table ii: descriptive statistics variable n mean sd min max it inv 1752 0.445 0.220 0.0004 0.982 it fin 1752 0.568 0.288 0.0681 2.691 it div 1752 0.808 2.888 0.0000 47.00 it sz 1752 15.45 1.622 10.893 20.31 it pro 1752 0.039 0.122 -1.9068 0.669 it liq 1752 1.502 1.290 0.0068 15.97 it go 1752 20.532 63.03 -287.67 1233 prior to performing the estimation of the models, the data were tested for multicollinearity. for this purpose pair wise correlation coefficients between variables were estimated. table 4.2. shows the correlation coefficients among the variables. the correlation coefficients among the explanatory variables are small which shows that there is no evidence of the problem of multicollinearity. table iii: correlation matrix variable it fin itdiv itinv itsz itpro itliq itgo it fin 1 south asian review of business and administrative studies vol. 3, no. 1, june 2021 6 it div -0.106 *** 1 it inv 0.198 *** -0.174*** 1 it sz -0.09 *** 0.132*** -0.165*** 1 it pro -0.445 *** 0.256*** -0.262*** 0.228*** 1 it liq -0.567 *** 0.140*** -0.332*** -0.005 0.296*** 1 it go 0.017 0.268 *** -0.095*** 0.092*** 0.231*** -0.012 1 note: *** significant at the 1% level, ** significant at the 5% level; and* significant at the 10% level. table iv: effects of explanatory variables on financing ( it fin ) variable ols fe re c 0.8778*** (15.52) 1.2748*** (8.01) 1.0201*** (10.75) it div 0.0021 (1.08) 0.0008 (0.05) -0.0003 (-0.24) it inv -0.0572 ** (-2.19) -0.1495*** (-5.09) -0.1106*** (-4.10) it sz -0.0064 ** (-1.89) -0.0348** (-3.44) -0.0184** (-3.12) it pro -0.7730 *** (-15.87) -0.3687*** (-12.18) -0.4068*** (-13.34) it liq -0.1086 *** (-24.05) -0.0601*** (-14.71) -0.0695*** (-17.68) it go 0.0003 *** (4.15) 0.0002** (2.58) 0.0001** (2.83) n 1752 1752 1752 r2 0.4155 0.3211 0.3926 f-statistic 206.76 72.880 prob. > f 0.0000 0.0000 wald 2  598.47 prob.> 2  0.0000 note: *** significant at the 1% level, ** significant at the 5% level; and* significant at the 10% level. t-statistics for the coefficients of the explanatory variables are reported in parentheses. estimation results of the financing equation are presented in table iv. in the context of pakistan it is shown that investment variable is significant determinant of the financing decisions in all estimation methods. but dividend variable is insignificant to financing decisions in all estimations that are ols, fixed effect and random effect. negative sign of the coefficient of investment in financing equation shows the inverse relationship between financing and investment decisions. our results confirm the findings of aivazian, ge, and qiu (2005), vo (2019) and rashid and karim (2018). the possible explanation of this relationship can be the theory of underinvestment proposed by myers (1977) argued that the highly levered firms invest less and forgo valuable investment opportunities. this is because of the problem of debt overhang. moreover for firms with high leverage, investment in valuable growth opportunities will benefit more to creditors than shareholders. south asian review of business and administrative studies vol. 3, no. 1, june 2021 7 the size of the company has also been found to be a significant driver of financing options. the size of the company and its funding options have a negative association. it means that huge companies rely on internal finances rather than taking on external loans. the pecking order idea is supported by our findings. according to the pecking order idea, as businesses grow, they earn greater revenues and can thus use internally generated cash rather than seeking debt. the negative link between leverage and business size is predicted by the pecking order theory. profitability, liquidity, and growth prospects are all crucial factors to consider when making finance selections. profitability and liquidity have a negative association with finance policy decisions, while growth opportunities have a favourable link. it means that firms that are more profitable and liquid have fewer needs for external financing. as a result, pakistani listed companies follow the pecking order theory's projected hierarchy of money raising. according to the pecking order idea, corporations prefer internal finance to debt (myers & majluf, 1984). as a result, more productive and liquid businesses have more internal money and fewer external funding needs. myers and majluf (1984), titman and wessels (1988), rajan and zingales (1995), nijenhuis (2013), acaravci (2015), and thalib et alconclusions .'s are all supported by our findings (2019). borrowings and development opportunities have a positive association, which supports the predictions of pecking order theory. growing businesses may require outside financing if their internal funds are insufficient. when it comes to external financing, the pecking order hypothesis predicts that enterprises will choose debt to stock. as a result, growth prospects and leverage are linked.empirical studies by ahmed et al. (2010), ahmad and abbas (2011) and thalib et al. (2019) also confirmed the positive leverage-growth relationship. the results of the hauman test indicates that the estimation results of the fixed effect are better than random effect. table v. hausman test coefficients (b)fe coefficients (b)re difference (b b) sqrt(diag(v_b v_b)) s.e. div .000853 -.0003935 .0004788 .0004816 inv -.149557 -.1106987 -.0388584 .0115575 sz -.034821 -.0184388 -.0163822 .0082217 pro -.3687321 -.4068675 .0381354 liq -.0601342 -.0695199 .0093857 .0011152 go .0001737 .0001867 -.000013 .0000142 chi2 = 54.45 prob.chi2 = 0.0000 conclusion we attempted to investigate the impact of corporate investment and dividend decisions on nonfinancial enterprises listed on the pakistan stock exchange's financing behaviour in this study. the sample comprises data from 292 businesses from 2013 to 2018. the results were estimated using panel data approaches such as pooled ols, fixed effect, and random effect. the study has offered empirical information on how enterprises in emerging economies finance themselves. the study's findings revealed that investment is a key driver, albeit one that has a negative sign. it means highly leaverd firms invest less. the relationship of dividend with financing is not significant. profitability and liquidity is significant to the financing and it shows more profitable and liquid firms borrow less. moreover the size of the firm is affecting negatively and growth south asian review of business and administrative studies vol. 3, no. 1, june 2021 8 opportunities affect positively the financing decisions. most of our results confirm the application of pecking order theory of capital structure in the context of pakistan. like other studies this study also has some limitations. further research might be conducted to redesign both conceptual framework and methodology. this study only focuses on the empirical investigation of the association between financing decisions, investment decision and dividend decisions. this study does not focus on the interdependence of corporate financial decisions. further research should be conducted that focuses on the interdependence of financial decisions by using simultaneous equation modelling, which may lead the different conclusions. references ab wahab, s. n. a., & ramli, n. a. 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(2012). the determinants of capital structure among smes in malaysia. paper presented at the proceedings international conference of technology management, business and entrepreneurship. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 107 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.2, december 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas how does terrorism affect economic growth? a case study of pakistan syed mumtaz ali kazmi, national college of business administration and economics, pakistan hassan mujtaba nawaz saleem, universiti utara, malaysia article details abstract history revised format: nov 2020 available online: dec 2020 keywords terrorism, economic growth, the aim of the study is to examine how and when terrorism start in the country. terrorism spoil the infra structure of a country. we analyze the effect of terrorism on the economic growth in pakistan by using annually time series data from 1970 to 2015. we have employed autoregressive distributed lag model (ardl) to examine the long run relationship of terrorism and economic growth in pakistan. data is gathered from world development indicator (wdi) and global terrorism database (gtd). the short run dynamics are obtained through error correction mechanism. the empirical results reveal that terrorism has negative impact on the economic growth and reduce the speed of economic growth. it also reduces foreign direct investment (fdi) in the country which results less investment. whenever investment decreases the employment opportunities also reduce and unemployment creates in country. unemployment creates aggression among people which is one of the causes of terrorism. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: kazmi.mumtaz@gmail.com doi: https://doi.org/10.52461/sabas.v2i2.453 introduction terrorism is described as “it is the use of violence by individuals or the groups to attain the political and social objectives”. it is a global phenomenon. it is highlighted after the 9/11 attacks on the world trade centre in america in 2001. south asia and the middle of the east are very much affected by war against terrorism. due to terrorism, pakistan suffers a lot economically. terrorism as it has been characterized since 9/11 has so far taken a loss of life of thousands of individuals, generally in iraq took after by afghanistan and pakistan. this variant of war against terrorism has expanded terrorists as well as it has died right around 4,000 innocent individuals in pakistan only. there are two main things which create terrorism and intolerance of pakistan in religious grounds. before 1980, religion was not a disputable issue is pakistan. however, the partisan hostile to shiite activist gatherings like the sipah-e-sahaba, were lecturing contempt against the shiite muslims. this partisan brutality came to pakistan simply after the 1979 transformation in iran, which changed the nature and extent of sectarian violence in pakistan. this was additionally bothered https://journals.iub.edu.pk/index.php/sabas mailto:kazmi.mumtaz@gmail.com https://doi.org/10.52461/sabas.v2i2.453 south asian review of business and administrative studies vol. 2, no. 2, dec 2020 108 when a sunni-commanded iraq with the support of usa and saudi arabia which pursued a war upon shiite ruled iran. these partisan associations were instrumental in the change of pakistan into an auxiliary war zone which thusly is a noteworthy reason for ascend in religious fanaticism and bigotry in pakistani society. a huge gathering of so-called islamic researchers today in punjab who had a place with hard-line salafi convention of islam, do transparently approve of suicide bombing. the followers of this group have faith in pursuing jihad against the jews and the shias and have appeared in majority rule government. the group pioneers have lectured that jihad ought to be pursued until 'islam' turns into the prevailing power in the world. it is absolutely in conflict with the philosophy on which quid-e-azam prefaced his battle for pakistan. he didn't win pakistan by pursuing a bleeding jihad yet brought it into being by pursuing majority rule battle against the british and the hindus. the muslims of unified india voted enormously for a different land where they would not be minimized by a non-muslim dominant part. other than those religious and ethnic clashes, another factor came in the shape of balochs patriotism. balochistan was formerly a free state, which in 1951 chose to converge with pakistan. however, after some time balochs felt that their assets were abused by focal government, while they are not given their due offer in those assets. this is on account of balochistan is rich in oil and gas, also, the greatest flammable gas save in pakistan is arranged in balochistan. this feeling of hardship drove them to begin aggressor struggle. military operations were completed against those militants in 70's and uprising was stifled. however, this new sort of militancy again began in the 2000's. literature review collier (1998) illustrate model of the monetary impacts of civil war and the post-war period is produced. a key component is the change of the capital stock through capital flight. post-war this flight can either be switched or, then again keep, depending mostly upon how far the capital stock has changed in accordance with the war. the model is tried on information for every single common war since 1960. after long polite wars the economy recoups quickly, though after short wars it keeps on declining. we at that point consider the impact on the organization of monetary action, recognizing war-helpless and war-safe exercises. proof for uganda shows such compositional impacts to be generous. the paper researches the results of common war for gdp and its synthesis. it centers especially upon the conduct of the economy in the early years of a peace settlement. common wars are at risk to be more harming than worldwide wars in a few regards. they are unavoidably battled altogether on the domain of the nation. they are probably going to undermine the state: the two its foundations, for example, property rights, and its associations, for example, the police. by differentiate; as herbst (1991) has contended, worldwide wars have a tendency to fortify the state. the devastation fashioned by fighting, and the disintegration of establishments and associations, constitute a weakening in the monetary condition. it may be normal that the closure of common wars would deliver a thusly expansive peace taking. drakos and kutan (2001) reveals that buyer decision demonstrate created by enders, sandler and paries (1992) is used to concentrate the territorial impacts of psychological warfare on contenders' pieces of the overall industry in tourism division were included nations appreciate critical tourism exercises be that as it may, are liable to high recurrence of fear monger assaults. the hypothetical model is tried for three mediterranean nations, in particular greece, israel, and turkey, for the period from january 1996 to december 1999, utilizing the apparently random relapse show. italy is utilized as a control variable in estimations, going about as an intermediary for visitor exercises in whatever remains of the mediterranean area furthermore, giving an extra goal to voyagers to visit. confirm demonstrates that the tourism business in israel and turkey are more delicate to psychological oppression episodes than in greece. there are likewise huge local disease impacts south asian review of business and administrative studies vol. 2, no. 2, dec 2020 109 of psychological oppression. they find that a more elevated amount of fear-based oppressor occurrences in greece is related with an expansion in the relative piece of the pie of israel in the area, while psychological oppression in israel advantages turkey's piece of the pie. likewise, record confirms that the area (urban versus country) and the power of fear-based oppressor episodes assume an essential part in the basic leadership procedure of vacationers for selection of goals. mordoch and sandler (2001) depends on a neoclassical development model to experimentally test for the impacts of a common war on relentless state pay per capita both at home and in neighboring nations. also, this model gives the premise to measuring long-run and short-run impacts of common wars on wage per-capita development in the host nation and its neighbors. confirmation of noteworthy inadvertent blow-back on monetary development in neighboring countries is revealed. also, this harm is ascribed to nation particular impacts as opposed to movement, human capital, or speculation variables. as the “potheyr of the measure” used to intermediary the contention increments, there are improved neighbor overflows. besides, inadvertent blow-back from common wars to development is more claimed in the short run. notwithstanding amid times of relative tranquil concurrence among significant forces, common wars with at least 1000 fight passing’s have tormented countries consist. in 1998, there're 25 noteworthy common wars seething in africa, asia, and somewhere else. since 1960, every thoughtful war has been in creating nations, whose monetary development and advancement are able to be blocked by the subsequent human capital misfortunes, decreased speculations, framework annihilation, and check movement interruptions. the information used to evaluate the parameters of the different determinations originates from four sources: the penn world tables, barro and lee (1996); individual correspondence with nicholas sambanis of the world bank; and the correlates of war project (cow), civil wars. factors which are utilized as a part of the paper are genuine gdp per capita in consistent dollar, normal speculation share, and yearly populace development (pop) and information use between the time of 1960-1985. the observational discoveries bolster our instinct that the nation's most at hazard from coincidental losses coming from bordering common wars they are those with longer touching fringes with countries in common clash. additionally, they examined that common war made a critical harmful impact on short-run development inside the nation and its neighbors. there was less obvious confirmation of a harmful effect of common wars on long-run development when considered over a quarter century time frame, which is likely because of the short-run nature of numerous common wars, so that their short-run effect is they kenned by union. piazza (2006) investigates the prominent theory that destitution, disparity, and poor financial improvement are main drivers of psychological oppression. utilizing a progression of numerous relapse investigations on fear-based oppressor episodes and setbacks in ninety-six nations from 1986 to 2002, the examination considers the criticalness of neediness, lack of healthy sustenance, imbalance, and joblessness. the discoveries are that, in opposition to well-known conclusion, no critical connection between any of the measures of financial improvement and psychological warfare can be resolved. or maybe, factors, for example, populace, ethnic-religious decent variety, expanded state restraint what's more, most fundamentally, the structure of gathering legislative issues are observed to be noteworthy indicators of fear-based oppression. frey et al. (2006) studied the patterns and results of fear-based oppressor exercises are frequently caught by checking the quantity of episodes and losses. all the more as of late, the impacts of psychological oppressor follows up on different parts of the economy have been broke down. these expenses are studied and put in context. as financial outcomes are just a piece of the general expenses of fear-based oppression, conceivable methodologies for assessing the utility misfortunes of the individuals influenced are talked about. results utilizing the life fulfillment approach, in south asian review of business and administrative studies vol. 2, no. 2, dec 2020 110 which singular utility is approximated without anyone else's input revealed subjective prosperity, propose that individuals' utility misfortunes may far surpass the absolutely none enders & sandler (2006) research on psychological oppression's effect on administration and universal business has expanded considerably since 9/11. however hypothetical and theoretical pondering the idea of the psychological militant danger and its suggestions for mnes, their partners, and the worldwide business condition stays immature. to offer another conceptualization of the psychological militant risk that considers its persisting elements and also its new measurements and detail the suggestions for mne procedure. as opposed to constituting a miniaturized scale level political hazard, the risk postured by worldwide psychological militant systems, nations fight, is best comprehended as a kind of full-scale level instability. a progression of recommendations educated by hypotheses of ecological instability and multifaceted nature are advanced and the paper finishes up with suggestions and headings for future inquire about. gaibulloev and sandler (2008) try to show that transnational psychological militant assaults had a noteworthy development restricting impact. an extra fear monger episode per million people diminish total national output (gdp) per capita increase by around 1.5%. transnational psychological warfare decrease development by blocking in government consumptions. not at all like creating nations, twisted nations can draw in psychological warfare without showing unsavory monetary outcomes; an inner conflict has the best development worry, about twofold that of transnational fear-based oppression. data is used from iterate global terrorism database and armed conflict database. for creating asian nations, wars have a much more prominent effect than fear-based oppression due on the jamming in of government costs. arrangement suggestions show the requirement for the asian nations to help their inferior neighbors in adapting to the depressing development outcomes of biased brutality. this is especially important as generation gets to be distinctly divided in asia with a specific end goal to benefit from similar favorable position and as provincial foundation systems. in the last, struggle plus fear-based oppression in single nation can make bottlenecks with area wide financial outcomes the association of south east asian nations (asean) and european union connection can help with planning endeavors to put down clashes and dispose of fear mongering. the asian development bank and the world bank could assume key parts, particularly after a contention finishes, to channel help for change so that once-troubled nations can gain ground quickly. nongovernmental associations and the united nations could likewise help with this post-struggle restoration. bashir et al. (2013) tried to investigate in the document influence of terrorism activities on financial markets prove from kse that the impact of terrorism occurring in pakistan on the kse karachi stock trade for the time of 1/2005 to 12/2010, using the garch and garch-evt to recognize the relationship between the two factors; the review built up psychological militant exercises unfavorably influence the money related markets and kse, it is exceedingly noteworthy connection. the motivation behind why the negative connection exists is a direct result of the premier increment in the quantity of terrorist attacks in pakistan. javed et al. (2013) explores the relationship among now of psychological oppression occurrences, age reliance proportion, future, gdp, development of populace and capital arrangement percent of gdp in pakistan for the period 1980–2011. the information for the momentum looks into ponders for the period 1980–2011 have been gathered from different sources. the information for the quantity of fear-based oppressor occurrences have been gathered from the global terrorism database (gtd). the informative factors incorporate gross capital development percent of gdp, development of net residential salary (gdp) per capita, development of populace, future, age reliance proportion and proficiency rate. information for capital arrangement percent of gdp, development of net local pay (gdp) per capita, development of populace, future, age reliance proportion and proficiency rate have been gathered from the world development indicator (wdi) south asian review of business and administrative studies vol. 2, no. 2, dec 2020 111 (2012) and different issues of economic survey of pakistan. johansen's strategy for co-integration and var is utilized to discover the connection among reliant and illustrative factors. be that as it may, the effect of informative factors on capital development percent of gdp with the exception of no of psychological oppression and age reliance proportion is sure over the long haul amid the time of study. likewise, the negative effect of fear-based oppression on capital arrangement percent of gdp mirrors the way that fear based oppressor assaults a possible decision measure up to open war in face of enhanced state limit. fatima et al. (2014) tries to give the observational proof of fear-based oppressor exercises effect the monetary development and the outcomes demonstrate that the terrorism exercises negatively affect the monetary development of the nation. the seven-year information from 2004 to 2010 from the world bank was utilized for the investigation. adf was utilized to discover the co reconciliation between psychological oppressor exercises of these two nations. two variables gdp growth rate and terrorism are utilized. this paper likewise dives into the points of interest of the connection between the terrorism exercises and the financial development of india and pakistan also, made a correlation between these two. india's financial development has no effect of psychological oppressor exercises while the financial development of pakistan does. comes about additionally demonstrated that the indian fear monger exercises have an effect on the pakistani psychological oppressor exercises in the short run, yet this effect is not steady over the long run. iqbal & lodhi (2014) said fierce and religious radicalism is quickly expanding in pakistan in the course of recent years. there is not just one factor that is in charge of the present monetary emergency in pakistan however every now and again evolving governments, incapable arrangements, defilement, misallocation and underutilization of assets joined with government's inability to battle against fear-based oppression and fanatic viciousness has emergency the economy since past decade. an economy that is battling hard to get by in the focused world has encountered low gdp development rates, open and private speculation, decrease in fdi and tourism, joblessness and neediness levels that never existed. the examination is a subjective one and it tries to look at the effect of vicious and religious fanaticism on the economy of pakistan by doing a cost and advantage investigation of us-drove war on dread that pakistan participated in 2001. the examination depends on the optional information got from different aggressiveness reports of world economic forum, pakistan institute for peace thinks about, sbp, handbook of statistics and different issues of economic survey of pakistan. the aftereffects of the examination demonstrate that psychological oppression and fierce fanaticism has made a terrible name for the nation in this manner exasperating the speculation atmosphere unfavorably. expanded barrier consumption has diminished open and private venture and ranges distressed with fanaticism have confronted descending winding in monetary action. hyder et al. (2015) have similar perspectives as indicated by them in the history, pakistan is confronting the danger of psychological conflict. other than confronting the results of afghan war, pakistan is also influenced by different tribal and religious clashes which have prolonged psychological militants' exercises. these ions have extremely influenced the structure of pakistan. utilizing information on psychological warfare from global terrorism database, ols for the era 1981-2012 has been joined. the study proposes that psychological warfare has badly influenced the financial increase in pakistan. along with the different factors that were utilized the fear-based oppression is most serious and major giver in lessening the monetary expansion. theoretical framework definitions: gdp gross domestic product (gdp) is one of the primary indicators which are used to gauge the health of a country's economy. it is the widest quantitative measurement of the entire economic activity south asian review of business and administrative studies vol. 2, no. 2, dec 2020 112 of a country. it shows the monetary value of all services and finished goods produced inside the geographic limits of a country during a specific time span (one fiscal year). one can think of it as the size of the economy. its growth is considered as a significant indicator of the economic performance of a country. the economy of a country is in downturn when its gdp declines. on the other hand, when gdp grows, the national reserves usually tend to instigate the economy by increasing the ratio of interest rates and fear of inflation follows this. population growth (pop) the increase in the number of people, reside within the state or country. it considered as the number of people increased in population in a country, a state or a city. global human population is increasing day by day. human capital gross enrollement ratio human capital is in monetary terms that how much a person skilled. how much a person is skilled. if anyone is skilled will be able for earning something. gross fixed capital formation gross fixed capital formation spending on the fixed assets' maintenance. it means it considered as depreciation cost. terrorism it is defined like as get work from anyone without his will. the gtd (global terrorism database) defines terrorism as “the threatened or actual use of illegal force and violence by a non‐state actor to attain political, economic, religious, or social goal through fear, coercion, or intimidation”. model spesification ✓ economic model gdp=f (pop, hc, gfcf, terr) per capita gdp is the function of pop, hc, gfcf, and terrorism these terms stand for: ✓ gdp=gross domestic product ✓ pop=population growth ✓ hc= human capital (used as proxy of school enrollment) ✓ gfcf=gross fixed capital formation ✓ terr= terrorism ✓ econometric model gdp=βo+β1hc+β2gfcf+β3pop+ β4 terr+ ui in above model, gdp, gfcf, hc, terr are referred to dependent and independent variables whereas β`s explain the effect of independent variables on the dependent variables. in the model, β1, β2, β3 and β4 show the effect of independent variables on the dependent variables. whereas βo shows the effect of all omitted or unexplained variable`s effect on dependent variables. methodology in order to estimate the impact of terrorism in gdp in pakistan we use the annual data from 1970 to 2015. the data of gfcf, hc, and pop is taken from the world development indicator of world bank (wdi). the data of terrorism are taken from global terrorism database (gtd). the gtd database provides details regarding total number of civilians, security forces and terrorist deaths, including data on injured persons in all terror related events, which have happened in various years in different parts of pakistan. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 113 in order to estimate the relationship between terrorism and growth of the pakistan economy we take the time series data from the 1970 to 2015. we have utilized ardl model to catch short and long run association. we have directed the adf test for request of combination. we have applied wald test for the existence of co-integration. we have utilized granger causality test for circumstances and end results. results are shown in the table a1 in appendix whereas the results of bond test and ardl are shown in the tables a2 and a3 in appendix respectively. for the purpose to check stationarity, the e-views software is used. first of all, stationarity is checked at level of all variables. but no variable is stationary at level. after that we check all variables at 1st difference. at 1st difference, all variables except pop are stationary. it means there is something happens in the pop data. to remove the problem, we take 2nd differenced to make the data stationary. so, the pop variable is stationary at 2nd difference. results the estimates show that the value of f-statistics is 6.123504 it is greater than upper bound value 3.52. therefore, we reject the null hypothesis of no co-integration and concludes that there is cointegration relationship in our data. once the co-integration relationship confirms, the next step is to estimate the long run model. the estimated long-term relationship is given below. long run the coefficient of terror variable is -0.043. it indicates that as the terrorism increases by one unit the gdp will decrease by 0.042 times. the probability value is 0.0614 which less than 10 % level of significance. so, the kill variable is highly statistically significant so the impact of terrorism is negative gdp which is support the existing literature. the coefficient of lgfcf variable is 216.79268. it indicates that as the increase in lgfcf by 1 unit the gdp will increase has 216.79268 five times. the probability value is 0.1264 which less than 10 % levels of significance so the gfcf variable is statistically highly significance. the coefficient of population growth is minus 78.718192. it indicates that 1-unit change in population growth will decrease gdp 78.718192 times. the probability value is 0.0625 which is less than 10% level of significance so the pop value is highly statistically significance. the coefficient of human capital is 42.642173. it indicates that as the increase in human capital by 1 unit will increase gdp by 42.642173 times. the probability value is 0.0048 which is less than 10 % level of significance so the human capital variable is highly statistically significance. short run the ect value is -0.324 and probability value 0.0052. it is statistically highly significance the coefficient of ect is 0.324 which shows that every year 32.40% error will be rectified so after 3 ½ years total error will be removed and the long run stable equilibrium can be achieved. conclusion and policy recommendation the aim of the study is to analyze the impact of terrorism on economic growth (gdp) in pakistan by using annually time series data from 1970 to 2015. we have employed autoregressive distributed lag model to examine the long run relationship of economic growth and terror attacks in pakistan. the short run dynamics are obtained through error correction mechanism. the empirical results reveal that both the variables i.e. gdp and terrorism are inversely related. all other variables like pop (population growth) and gfcf (gross fixed capital formation) also affect gdp. hc (human capital) and gfcf (gross fixed capital formation) are positively affected while pop (population growth) has negative effect on gdp (economic growth). south asian review of business and administrative studies vol. 2, no. 2, dec 2020 114 in the long run, 1 percent increases in terrorism yields an average 0.043087 percent decrease in gdp while 1 percent increase in gfcf yields an average 216.79268 percent increase in gdp. in short run, 1 percent increases in terrorism yields an average 0.013963 percent decrease in gdp, while 1 percent increase in gfcf yields an average 650133284 percent in gdp after lag 1. policy recommendation in the light of the above study and results we can say; ✓ there should be control on the border lines with neighboring countries, which cause the suspicious activities in pakistan. ✓ there should be check and balance on entry and exit ways of all cities. ✓ government should be more efficient regarding all the security departments in pakistan so that every single activity may be monitored. ✓ government of pakistan should be focused on policies for foreign direct investment in country so that capital formation may increase in country and economic growth may boost up. ✓ government should also pay attention on school enrollment so that the literacy ratio may increase. besides this the government should take initiatives for the betterment of the school health and nutrition for increasing the literacy rate in the country. ✓ to control suspicious and terror activities, every individual of pakistan should be registered with central database like nadra. ✓ to prevent from deaths due to terror attacks, government should make rescue teams more efficient and more effective so that quick medical treatment may provide to victims. references abadiea. a,, gardeazabal. j, (2008), “terrorism and the world economy”, european economic review , vol: (52),pp 1–27 bashir. u., haq. i., gillani. s., ( 2013) “ influence of terrorist activities on financial markets : evidence from kse”, financial assists and investigation. pp 5-13. collier. p., (1998) “on the economic consequences of civil war” oxford economic papers, vol: 51, pp.168-83 drakos, k and kutan, m. a (2001), “regional effects of terrorism on tourism: evidence from three mediterranean countries”, working paper (unpublished manuscript economics & politics, vol.21(3):409-432 enders, w., sachsida, a., sandler, t.(2006). “ the impact of transnational terrorism on usforeign direct”. frey. b.s., luechinger.s., stutzer. a, (2006) “calculating tragedy:assessing the costs of terrorism” forthcoming in the journal of economic surveys fatima . m., latif. m., farooq chugtai. s., hussain. n and aslam. s, (2014) “terrorism and its impact on economic growth: evidence from pakistan and india, middle-east journal of scientific research, vol: 22 (7), pp. 1033-1043 gaibulloev. k., sandler. t, (2008) “the impact of terrorism and conflicts on growth in asia,1970–2004”, adb institute discussion paper, vol: 113. greenbaum. r.t., dugan. l., lafree. g, (2007), “the impact of terrorism on italian employment and business activity” urban studies, vol : 44 (5/6), pp 1093–1108 hyder. s., akram. n., padda. i, ( 2015) “impact of terrorism on economic development in pakistan”, pakistan business review, pp 704-722. iqbal. z., lodhi. s, (2014) “extremist and religious violence: an economic overview of pakistan”, international journal of research in applied, natural and social science, vol:2 (11), pp. 195-212. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 115 javed. z.h., farooaq. m., qadir. s, (2013) “impact of life expectancy and terrorism on capital formation: empirical evidence from pakistan”, international journal of innovative research and development. khan. m.t., ( 2013) “the social, political and economic effects of the war on terror: pakistan 2009 to 2011”, issra papers, pp.65-90. lizardo, o. (2008). “defining and theorizing terrorism: a global actor-centered approach”, journal of world-systems research, vol: 19, pp. 91-118 murdoch. j. c., sandler. t ( 2001) “economic growth, civil wars, and spatial spillovers”. piazza. j. a., (2006) “rooted in poverty?: terrorism, poor economic development, and social cleavages”, terrorism and political violence, vol:18, pp.159–177. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 116 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 89 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas how the students’ competitive and collaborative styles of learning are affected by personality traits at the university level kashif akbar, department of commerce, bahauddin zakariya university, pakistan muhammad umer quddoos, department of commerce, bahauddin zakariya university, pakistan sabeen khan, department of management sciences, comsats university islamabad, pakistan article details abstract history revised format: nov 2021 available online: dec 2021 keywords learning style, personality trait, competitive, collaborative investigating how personality traits affect competitive and collaborative learning is the goal of the current study. when examining the influence of personality traits on learning styles, big five theory was employed. two hundred students were casually picked using the non-probability selection approach for this descriptive study design. after translation into the native language, a large-scale portfolio and the grasha-riechmann scales of student learning skills were utilized. cronbach's alpha provided proficient estimation, pilot testing, and consistency, which all confirmed the instrument’s validity (α = 0.94). five elements correlated with students' learning styles, including their personality traits. students may benefit from a teaching approach that considers their unique characteristics and learning styles. social training, academic achievement, and collaborative chances influenced personality traits and learning. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: umerattari@bzu.edu.pk doi: https://doi.org/10.52461/sabas.v3i2.736 introduction personality and learning styles are examples of individual diversity. learning and personality development are affected by these qualities for every learner. different situations and environments shape our disposition. various traits and distinguishing qualities distinguish one person from another (khan, 2018; joyce, 2020). when combined in a group, personality results from various traits, qualities, and temperaments. various studies have studied the relationship between traits of personality and extra factors such as work routine, educational accomplishments, and knowledge (busato et al., 1998; chioqueta & stiles 2005; joyce, 2020; chamorro premuzic & furnham, 2008; molleman, 2005; blickle, 1998). directly and indirectly, pupils' performance is influenced by the synchronization of learning and personality traits. individual personality qualities are expressed in pupils' actions, perceptions, and feelings. there are also distinct dimensions to these features. for example, openness to experience is one of the sub aspects https://journals.iub.edu.pk/index.php/sabas mailto:umerattari@bzu.edu.pk https://doi.org/10.52461/sabas.v3i2.736 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 90 theorists have identified. everyone also has unique personality qualities that influence their education (mcadams & pals, 2006). students' personality traits and styles of learning often interact in educational consciousness. the influence of personality traits on educational achievement has been proven by several researchers (rashid et al., 2012; kamarulzaman, 2012). personality traits are crucial to achieve targeted aims and deal with unique situations (caligiuri, 2000). in further arguments, personality traits ease education and encourage individuals to continue or abandon an activity (blickle, 1998). these investigations, however, are confined to the associative level of cognition. in light of this link, people’s conduct is also affected by the interaction of these characteristics. although personality traits may not have a universally agreedupon description, they are understood in specific conceptualizations (halder et al., 2010; khan, 2018). "the big five theory" introduced a universal framework of traits of personality that was widely accepted. extraversion, agreeableness, awareness, and neuroticism are among the five criteria listed. these big-five characteristics are the result of personality traits that have been categorized. according to psychologists, there are five big five personality traits (inventory). traits of personality and learning styles can be combined or mediated in research, although they have not been conducted in-depth. these investigations were conducted in foreign populations (joyce, 2020). the investigation of personality traits and their impact on learning in pakistan and other specific aspects. therefore, students' collaborative and competitive learning methods are being examined in the present study. literature review a literature review shows that personality traits have a great influence on concepts such as learning effectiveness, nationality configuration, work synchronization and morals, entrepreneurialism, anxiety, and stress, as well as happiness and involvement in procedure or trying to learn thoughts, such as informative action or engagement (miller, 1991; organ & lingl, 1995; chioqueta & stiles 2005; berings, de fruyt & bouwen, 2004; barrick& mount, 1993; erdheim, wang & zickar, 2006; blickle, 1998; molleman, 2005; busato et al., 1998; chamorro-premuzic & furnham, 2008). in contrast, little research has examined the link between personality and learning styles. a wide range of researchers has identified the link between learning and personality types. still, in general, people believe that only a dedication to learning may be insufficient for knowing properly. instead of wasting too much time on the solitary topic, work may be finished more accurately by adopting various learning styles. it is possible to increase the intellectual drive amongst individuals by encouraging them to study in various ways. the disruption of personality traits significantly impacts learning attitudes and styles that manifest as habits as a somewhat abstract concept. personality traits are crucial to achieve targeted aims and deal with unique situations (caligiuri, 2000). blickle (1998) argues that personality traits can influence learning behavior and drive individuals to engage in or leave an activity. learning is undoubtedly an informative process that relies on memory, attention, observation, and reasoning. as opposed to this, learning refers to the systematic organization of mental functions in response to external stimuli. working as an agent through this process is typically influenced by personality traits. in this way, they affect learning attitudes (de raad & schouwenburg, 1998). personality traits influence learning styles, which is strong. personality an individual's unique features and temperament and the combination of those characteristics that make them stand out in different situations are referred to as "personality" (phares, 1991). it is described as the unique adaptability, specific affiliation with life, and cultural differences of each human being (hogan, hogan & roberts, 1996; mcadams & friends, 2006). diverse qualities and elements with different meanings are used to describe personality. extraversion, neuroticism, and paranoia are the personality traits that j eysenck (1967) referred to about the notion of biological south asian review of business and administrative studies vol. 3, no. 2, dec 2021 91 stimuli. to increase human stimulation levels, h. j. eysenck proposed a variety of approaches. so, extraversion wants a constant stimulation stream to keep their energy levels up. as a result, they are talkative, emotional, energetic, courteous, and social. but individuals also appear to be very emotional and neurotic; they are timid, disturbed, and insecure; they are nervous or troubled; they distrust people even when they are in traditional settings. in addition, androgenic adrenaline is strongly linked to psychotic traits of personality. consequently, a link has been shown between personality and the different aspects, including consideration and memory. they also overpowered several other variables (erdheim, wang & zickar, 2006; daderman, 1999). even though traits of personality are not universally acknowledged, there is general agreement on five components that constitute traits of personality (ackerman & heggestad, 1997; goldberg, 1990; costa & mccrae, 1995, 1997; digman, 1990; mccrae & costa, 2005; busato et al. 1998). big-five traits of personality over discrimination, hard inquiry, and objective-driven questions, improved personalism investigation led to the improvement of the five-factor model (ffm).ob several examples were analyzed, and the results were determined to be accurate. they include extraversion, conscientiousness, agreeableness, openness, and neuroticism (burke & witt, 2004; barrick and mount, 1993; mccraea& john, 1992; busato et al., 1998; harris &lee, 2004; heller, decide & watson, 2002). conscientiousness labor, success-orientation, heedfulness, and persistence are the most common characteristics linked with this attribute (barrick & mount, 2001; erdheim, wang & zickar, 2006). relationships between personality and responsibility, organization, and performance are evident. however, those with a lower responsibility appear to be undisciplined, unorganized, delaying, and careless (costa &mccrae, 1995). agreeableness stereotypical qualities such as compassion, self-sacrifice, or moral support are on the one hand; apathy, aggressiveness, self-concern, and protectiveness are on the other hand (barrick & mount, 2001; erdheim, wang & zickar, 2006). friendship-oriented individuals are trustworthy, fast, and humble. those with low respect for others display aggressive, competitive, untrustworthy, and doubtful qualities (graziano, jensen-campbell & hair, 1996; bono, boles, decide & lauver, 2002). openness openness is a quality shared by those who like discipline and unsophisticated innovative thought, creativeness, diversity, discerning, uniqueness, a sagacity of amazement, and complexity (erdheim, wang & zickar, 2006; barrick & mount, 2001). from 5 major personality traits, this one has the finest psychosomatic component in that regard: inventive and inventive people who are boastful and determined, as well as unique and self-reflective individuals who are regarded to be indifferent (costa & mccrae, 1995; bond et al., 2002). neuroticism on the other hand, neurotic persons tend to overestimate negative feelings such as guilt and anger. persons with a high level of emotional distress are agitated and anxious in this way. mentally healthy individuals are enthusiastic and calm (costa & mccrae, 1995). extraversion an important personality trait is self-assurance, which comprises five factors: social will, communicativeness, aggressiveness, and determination (barrick & mount, 2001). a great notch south asian review of business and administrative studies vol. 3, no. 2, dec 2021 92 of socializing makes a person favorable, emotionally, passionate, dominating, and forceful. in contrast, a low degree of socialization makes a person introverted, timid, relaxed, and usually secluded, according to research (bond et al., 2002). styles of learning interpretations of general public ideas in a larger context are notoriously difficult to agree on. unconsciousness gets difficult to define every attempt (shuell, 1986). several commonalities characterize human learning. taylor & mac kenney (2008) explain how learning needs specific behavioral changes over time (schunk, 2012). according to lafrancois (2000), learning occurs when ripening, tiredness, medicines, and physical traumas do not result in a reasonably lasting shift. people's behaviors change over time due to regular interactions, suggesting that learning is a very enduring phenomenon. in literature, knowledge is seen as a type of thinking and comprehending. styles of learning include shallow or intensive data analysis, methodical and periodic information management, total volume, archiving, and systems retrieving (busato et al., 1998). their processes may determine a person's learning style to obtain and evaluate knowledge and information (ekici, 2013). as a result, the most prevalent educational approaches may be classified into three categories: deep knowledge and data processing, acquiring, and simple information processing. when it comes to data collecting, students who have a performance-oriented mindset tend to be materialistically motivated by the prospect of receiving a high return on investment in terms of learning habits. wilsfok (2009) describes learning styles as distinct ways of thinking and managing knowledge. there are diverse workplace types and styles, such as group and individual work. teachers might be prepared with worksheets and strict directions for their study projects. pupils study individually when they are alone and isolated from other students. the teacher passes on information and benefits to the learner. teachers offer the bulk of knowledge sources, encouragement, suggestions, and reviews in this type of learning. materials and components should be readily available to students. evaluations are generally based on several variables, and learning is beneficial on its terms. in collaborative learning, pupils work in small sets to attain a mutual objective. as a group work technique, collaborative learning reduces the incidence of such difficult conditions and spreads awareness and contentment in the high-performing workforce. methodology the current study investigated the influence of personality traits on learning styles using a quantitative approachquestionnaire survey method. the convenience sampling approach was used to choose 200 students from the bahauddin zakariya university, multan, for data gathering and analysis. data collection the data was collected in person at the bahauddin zakariya university multan-the largest university in the southern region of punjab province, pakistan. as the students filled out the survey form, the researcher advised them to complete it correctly and completely. instrumentation as part of the instruments used to obtain student opinions on the influence of personality traits on the styles of learning, grasha-riechmann and big five inventory students style of learning scales were administered. it was also localized into the urdu language to ensure authenticity and dependability. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 93 validity and reliability the validity of the questionnaire was verified with the aid of an expert's judgment. pilot testing was conducted on 20 students who were not part of the research to determine the dependability of the results. in terms of dependability, a value of 0.94 was found. analysis and discussion of results the spss file contained the data of 200 students. we began by using exploratory factor analysis to identify the scale's components. each of the seven subscales, each with 62 items, was split into five substitute scales of traits of personality and two styles of learning. there was a factor loading of more than 0.41 in all statements, the value of kmo was 0.85, and 0.94 was of reliability. analyzing the data included descriptive (standard deviation, mean) and inferential (multiple regression and correlation) statistics. table 1: standard deviation and central tendency of respondents concerning the influence of traits of personality on competitive and collaborative styles of learning factors n value mean value standard deviation agreeableness 200 1.9574 1.23624 extraversion 200 1.9190 1.26157 conscientiousness 200 2.3524 1.26815 openness 200 2.3691 1.30698 neuroticism 200 2.3970 1.40963 competitive 200 1.7583 1.49175 collaborative 200 2.5058 1.27853 table 1 provides the mean value and standard deviation value of answers. there is a center point of 2.00 beneath three central values, which show a tendency of a discrepancy between respondents, and three central values, that indicate a tendency of contract among respondents. it is also worth noting that mean of the collaborative style of learning (2.5058) is higher than the mean of the competitive style of learning (1.7583). table 2: pearson’s correlation between competitive and collaborative styles of learning with five factors of traits of personality factors extraver sion agreeable ness conscientio usness neuroti cism openn ess collabor ative competi tive extraversion 1 agreeablene ss .97** conscientio usness .95** .95** neuroticism .97** .96** .94** openness .95** .93** .94** .97** collaborativ e .94** .91** .95** .95** .97** competitive .93** .94** .89** .90** .85** .84** 1 ** correlation is significant at the level of value 0.01 (2-tailed). the pearson's r was conducted to determine the connection between the characteristics of extraversion, agreeableness, neuroticism, openness, conscientiousness, competitiveness, and collaboration. there was a strong positive association between variables at a significant level of south asian review of business and administrative studies vol. 3, no. 2, dec 2021 94 p< .001. as a whole, there was an important link between traits of personality and competitive and collaborative styles of learning. table 3: multiple regression foretelling influences of personality traits on collaborative styles of learning factors β t-values p-values extraversion .314 5.991*** .000 agreeableness -.561 -.11.485*** .000 conscientiousness .517 15.992*** .000 neuroticism .066 1.146 .254 openness .624 13.568*** .000 *p<.05, **p <.01, ***p<.001 r square =.883 f = 4542.146*** f=4542.146, df=4.395, p=.000, and r square=.883 were obtained via multiple regression to examine how personality traits affect collaborative learning styles. it was shown that personality traits had such a favorable and substantial impact on the collaborative style of learning (p=.000). neuroticism was determined to be statistically insignificant at b =.066, whereas agreeableness was shown to be significant at b =-.561. table 4: multiple regression foretelling the influence of the traits of personality on competitive styles of learning factors β t-values p-values extraversion .788 7.138*** .000 agreeableness .985 9.572*** .000 conscientiousness -.061 -.877 .382 neuroticism .117 .972 .333 openness -.692 -7.133*** .000 *p<.05, **p <.01, ***p<.001 r square = .843 f= 1306.839*** table 4 shows the effects of personality traits on the competitive learning style, with f=1306.839, df =4.395, p =.000, and r square=.843 as the findings. except for openness (b = -.692) and conscientiousness (b = -.061), traits of personality have a positive, substantial influence on the competitive style of learning, and the effect is statistically substantial (p =.00). conclusion our study found that personality traits significantly influenced competitive and collaborative learning styles. the mean value of the collaborative learning style is higher than the competitive learning style, indicating that the students are more attentive in this style of learning because they possess the traits of personality associated with it. cooperation fosters interpersonal interactions, boosts social sustenance, and improves self-esteem (prince, 2004). to describe the dynamic link between personalities and learning styles, a pearson correlation was calculated. apart from neuroticism, the results of multiple regression indicated that the variables of personality traits such as agreeableness, extraversion, openness, and conscientiousness all play a role in influencing collaborative learning style. still, conscientiousness did not influence competitive learning. according to the results of our study, students at the bahauddin zakariya university are less interested in competing over collaborating when it comes to their learning style. while according to albert (2009), students' academic performance is enhanced by good social behavior at the university of georgia exhibiting better social behaviors. competitive learning style characteristics such as consistency, carelessness, detachment, and reserve are less common among students at this university than others. in johnson, johnson, and smith's (1998) study, cooperation was also more effective than individual labor across the board. according to the study's analysis, no gender-based disparities in answers were identified. in addition, an important link was discovered between five south asian review of business and administrative studies vol. 3, no. 2, dec 2021 95 personality traits and two learning styles, indicating that personality traits indeed influence students' learning styles. two forms of learning were also shown to be associated with five personality traits, indicating that students' personalities may affect their types of learning. however, students at bahauddin zakariya university with personality traits such as ingenuity or friendliness are also confident and are more likely to engage in collaborative learning than those with personality traits such as consistency or carelessness, which are more likely to do so engage in competitive learning. recommendations in the light of our findings, the following recommendations are put forward: 1. to grow and improve their cooperative personality qualities, students need to have many collaborative work opportunities. 2. it is necessary to allocate time for learners’ group activities. 3. policymakers should create curricula based on students’ personality traits, tendencies, and inclinations. 4. students' social development must be prioritized to better adapt their behavior to social norms and values. 5. students should develop organizational and management abilities as part of their personal growth. references ackerman, p. l. & heggestad, e. d. 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(2001). personalize training: determine learning styles, personality types and multiple intelligences online. the learning organization, 8(1), 36–43. south asian review of business and administrative studies vol. 2, no. 2, dec 2020 117 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.2, december 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas the effect of e-information services on university brand image and smes sustainable growth through e-learning and entrepreneurs’ satisfaction with the moderating role of enduring involvement: a post-effect of covid-19 in universities of punjab muhammad nadeem khan, trust for democratic education and accountability islamabad, pakistan suhail sharif, chongqing university, china ghazanfar ali, universiti utara, malaysia article details abstract history revised format: nov 2020 available online: dec 2020 keywords information and communication technology, the standard of einformation, entrepreneurial elearning and satisfaction, university brand image this study investigates the effect of information and communication technology, the quality of e-information, entrepreneurial e-learning education and entrepreneurial satisfaction on the university brand image. the population for the current study would be the entrepreneurial students of public and private universities in punjab. for the conceptual study, findings would reveal the effect of ict, eservice and e-information quality on university brand image and smes sustainable growth through mediating effect of e-learning education and entrepreneurs satisfaction and the moderating effect of enduring involvement of entrepreneurs. moreover, this research will have specific consequences for universities to establish an e-learning network to face the covid-19 situation for their entrepreneur students. it suggests for academic institutions to successfully incorporate the learning management framework to increase university brand image through e-education system. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: muhammadnadeemk@gamil.com doi: https://doi.org/10.52461/sabas.v2i2.454 introduction the covid-19 pandemic is becoming a worldwide health issue with a major effect on education. also, several institutions have shut down and required e-learning from home. students and instructors are reacting differently because of these remarkable changes. specifically, in the educational institutes. various coping strategies have been used to deal with the crisis of covid19, for example, socialization techniques were employed in the classroom that caused the drastic decrease of physical interaction. in the same time, advance techniques have emerged in an online format to replicate certain socializing patterns. inventive thought has indicated that it is feasible to utilize the same style of instructional methods digitally but in a new medium. https://journals.iub.edu.pk/index.php/sabas mailto:muhammadnadeemk@gamil.com https://doi.org/10.52461/sabas.v2i2.454 south asian review of business and administrative studies vol. 2, no. 1, june 2020 118 in a technical environment, when the quality of a university depends on society, universities strive to interact more with the community (bao, 2020). to develop community interaction more effectively, online learning is important because it can be done anytime at any moment. a successful system of higher education has been characterized as generating awareness and providing support to the community through education and training at complementary levels (cremonini, westerheijden, benneworth, & dauncey, 2014). researchers such as martin & turner, (2010) proposed that to develop an entrepreneurial university, an effective method is needed. building an entrepreneurial university is vital as successful entrepreneurial universities have distinguished features that differentiate them from their rivals. the covid-19 crisis has culminated in a desire for more universities to be deemed creative. this will cause management to confront economic uncertainty caused by the covid-19 recession, pressuring them to pursue more inspiring goals (gössling, scott, & hall, 2020). due to covid-19, universities have to remain vigilant and adaptive. not only did the disruption created by covid-19 pose an imminent danger to universities' financial survival, but it has also offered an impetus for creativity to thrive. universities have had to think critically to build modern interactive distance learning and training for interactional activities. it indicated that universities have advance technological landscape to respond to the contemporary climate; most of them are unprecedented territories (ratten, 2017). in these days, universities have interconnected tools on regional basis that add to the community's social structure (scott, hughes, & kraus, 2019). this means that in academics, employees establish skills of expertise that could be an incredibly valuable source of creativity. further, there has to be an agreement on the best potential causes of action because of the various interests amongst participants in a university. in addition, there has to be alignment and collaboration between participants of the university to promote progress, especially in the time of crisis, such as covid-19 (lackie, najjar, el-awaisi, frost, green, langlois, & khalili, 2020). such atmosphere fosters the utilization of the main information of a university that requires advanced research. while universities involved in economic growth initiatives such as technology development do so, heavy focus should also be placed on how to address the current economic crisis in covid-19. to effectively cope with the challenges of covid-19, there is a worldwide initiative toward online education (adnan & anwar, 2020). the rapid transition to all educational sector is being made by adding an entirely unanticipated virtual classroom climate. it indicated that there was not much opportunity for students and teachers to adapt to a new world that puts more impact compared to the face-to-face communication. that led the teachers to several challenges on how to collaborate in an online environment with students (weick & sutcliffe, 2011). in pakistan, the government’s spokesperson on health established the correctness of first two suspected cases of covid-19 on the 26th february 2020. the first case of covid-19 diagnosed in a student from the university of karachi, sindh and second case was found in an individual from the capital territory of pakistan. the country witnessed a surge in number of cases from initial three more cases on 4th march 2020 to 457,288 confirmed cases of covid-19 as on 11th december 2020. south asian review of business and administrative studies vol. 2, no. 1, june 2020 119 figure 1: national institute of health the closure of academic institutions to decrease public health disaster or any unfortunate situation is consequential to prevailing pandemic situation. united nations educational, scientific and cultural organization (unesco) has suggested the educational facilities to get prepared with information technology tool and expand online learning ways for the students to minimize the effect of closure of institutions (crawford et al., 2020). in this regard, higher education commission of pakistan (hec) rapidly responded to the closure of universities by recommending their administrators to establish and manage a well-integrated e-learning framework. however, the system of higher education in pakistan is still based on the traditional techniques to impart knowledge and skills and all universities generally are recognized by the hec. so, for the reason of the pandemic situation, the aim of the study is to boost the image of brands of university while providing better education facilities to entrepreneur student through online in the perspective of pakistan. the greatest and abrupt effect of impositions of lockdowns proved to be the suspension of economic activities throughout the country. the lockdown was initially imposed in sindh province only, with effect from march, 23rd 2020. the provincial capital, karachi, holding the 30 percent share of country’s total exports, suffered heavily. as on the first working day in karachi, fewer than 50 industrial units were functional out of 2700 industrial units in the zone (hussain, 2020). moreover, (hussain, 2020) also described that approximately five (05) million people in pakistan are surviving below the poverty line. whereas, there are multitude of semi-skilled or unskilled laborer who are struggling as subsistence farmers, waste-collectors, transporters, and domestic servants on daily wages basis. the author has further elaborated that, almost four (04) million daily wagers are working only in karachi, besides of four (04) million such workers in the province of punjab. this group of the society is suffering badly and barely manage to live in such harsh circumstances due to lockdowns. as per latest recorded figures, the micro-enterprises and self-employed people make the 35.7 percent of total national employment of pakistan (2017-2018) (sohail, 2019, p. 7). moreover, 55.6 percent of these small business entities or self-employed persons are exposed to risk. agriculture consists 87.8% of vulnerably employed micro-enterprises. similarly, whole-sale and retail consists 69.60%, transport and communication has 49.40% employed at risk, 48.60% of hotel and restaurants sector are vulnerable employed group, in communication and transportation 49.40% of self-employed people are vulnerable as compare to 63.40% of real estate and business , (sohail, 2019, pp. 10–12). figure 2 below depicts the clearer picture of sector-wise distribution of vulnerable employment and its implications on small enterprises can be better deduced in prism of covid-19. south asian review of business and administrative studies vol. 2, no. 1, june 2020 120 theoretical framework in this paper following terms are very important. they are defined and elaborated for the convenience of the readers. learning learning can be defined as an interaction with environment that can bring about a relatively permanent change in a person’s behaviour, cognition or affect. the change brought about by learning is effected either by acquiring something new or modifying something that already exists and this change must be durable. it is generally acknowledged that learning outcomes can be skill based or affective but it does not include behaviour changes that are caused by physical maturation or a temporary condition. it is further added that hrd focuses on intentional instead of incidental learning. in the recent times various learning theories have been advocated. these theories include humanism, social learning, constructivism, holistic learning, behaviourism and cognitivism. these theories supply ground to facilitate development and behavioural change. thus the nature of learning demands active involvement of the employees of an organization. anonymous (n.d.) observes that hrd practices lead to causing a long-term, work related learning capacity at the individual, group and organizational level. scholars began to recognize the importance of learning during the last quarter of the 20th century and termed learning an important developable and tradable commodity of an organization. the literature, in respect of learning, usually focuses on changes in cognitive maps or changes in behaviour. elaborating the concept of these changes, wang & huang (2013) say that “the cognitive approach operationalizes learning in terms of the cognitive patterns associated with processing information and interpreting events. the behavioral approach operationalizes learning in terms of a routine-based mechanism in repeating or changing behaviors to respond but cognitive elements are not involved in the process (pp.56-57).” performance usually the concept of performance is associated with the assigned tasks. and this term is defined in the perspective of task. thus performance is the result of an effort to complete some task with special reference to time, cost and quality. peters (2007) elaborates this term or concept in broader terms when he says “performance means the amount of overall achievement of an individual or an organization throughout a specific amount of time. when performance is considered in the perspective of an individual or employee, attitudes and behaviour of that employee are also taken into account.” peter means to say that the concept of performance is not restricted to specific results of an effort that is made for the realization of organizational objectives. the performance of an employee also includes his/her certain behaviour that appear in the effort. another related concept is performance development which in the view of hu (2007) “is a systematic process of improving employees’ performance, involvement, motivation, and commitment in order to enable organization to achieve its strategic objectives.” sustainable performance the dilemma with performance is that it is mostly inconsistent and unreliable phenomenon whereas individuals and organizations need a consistent and sustainable performance to keep their competitiveness intact. its consistency may be insured through certain measures. in this context peters (2007) maintains an appropriate rather useful approach. according to him there are four basic elements that are common to all human performance: (1) knowledge is the foremost necessity for being able to do things or being “proficient” in doing things. if, for example, an employee or manager has knowledge of the steps in good decision making process, he will give better performance in decision making. (2) skill is an individual’s level of proficiency in south asian review of business and administrative studies vol. 2, no. 1, june 2020 121 performing tasks. simply having knowledge of doing things does not suffice for performing each task well. mostly, knowing how to do things does not translate into a good performer. here one needs some proficiency in completing steps of doing things. (3) for giving high performance, individuals need to be enabled to perform i.e., they should not suffer from environmental roadblocks or restrainers (hostile culture and negative attitudes). (4) for the achievement of high performance mark, employees must be willing to use their knowledge and skills and also be willing to overcome the environmental roadblocks which inhibit their performance. the willingness of employees can be called as attitude. what one needs to do with these elements to enhance the performance is to gather them and put them together after understanding the relationship between the four elements of performance. one needs to combine knowledge and skills for acquiring ability to perform. research methodology aim of the paper in the light of considerations of the value of human resource and controversy of hrd paradigms, our main objective in this paper is to identify the element that can help process and promote learning to realize the objective of sustainable and optimal performance of the employees with the help of which organizations can outperform their competitors, dominate their respective markets and win the position of sustainable competitive advantage. we begin our thesis by examining the concepts of learning and performance. this lays the foundation for determining the elements that can cause and sustain the process and promotion of learning. research question the following question will lead us through this paper: what are the elements that make it possible that learning is processed and promoted to achieve the end of effective performance and how these elements are utilized for the intended purpose? learning paradigm versus performance paradigm in the recent times two approaches i.e., learning paradigm and performance paradigm have become famous in respect of achieving the level of optimal performance. in the opinion of song, kim & kim (2007) in the earlier times (mid-1900s) hrd practioners considered “training and development” more important. their main emphasis was on improvement of individuals’ knowledge, skills, and attitude through short-term and at-the-spot training programmes. on this basis it was expected that the results of training came out immediately. later, the focus shifted to the learning process of individuals and organizational improvement with the help of integrated learning process. both the paradigms have their claims regarding the realization of performance of workers and organizations. in the following lines both these paradigms are compared: scope of learning it is generally considered that the scope of performance paradigm in respect of imparting knowledge and skills to the workers is limited. in this connection, harrison & kessels (2003) observe that in performance paradigm, the hrd functions are concerned solely with learning inputs, improvement of individual performance and training-dominated activity. in the consequence of this approach individuals’ learning process or organizational performance improvement remains unattended to. hu (2007) also criticizes performance paradigm for its limited scope, as in this paradigm of hrd, policies and activities focus performance improvement or efficiency and negate everything else. contrary to the position of performance paradigm, hrd as an organizational process encompasses skillful planning, facilitation of a variety of formal and informal learning and knowledge processes and experiences for the purpose of enhancing organizational progress and individuals’ potential with the help of competence, adaptability, south asian review of business and administrative studies vol. 2, no. 1, june 2020 122 collaboration and knowledge-creating activity of employees and managers of the organization. seeing the position of performance paradigm, it can be said that the rationale of hrd at individual level seems to be focusing on self-actualization and self-development through using a variety of learning concepts whereas at societal level also it is required to generate higher-order knowledge, skills, innovation, and sustainable development of a workforce to enhance the nation’s competitive advantage. therefore, need is felt that the scope of performance paradigm should be broadened to include the purposes for both individual hrd and national hrd. status of workers in the view of the advocates of performance paradigm human beings are merely capital investment in a system and their function is to produce value-added performance in the form of goods and services. contradicting the position of performance paradigm, duke & udono (2012) highlight the value of human resource saying that in all the establishments, whether private or government, people are the most influential and responsible resources for the success of an organization because it is they who set the agenda, objectives and strategies; design, produce and deliver the goods and services and control their quality for the organization. further, human beings in the workplaces do not put themselves as capital and insensate parts of systems for yielding returns on investment of corporate shareholders. hu (2007) advocates the concept of learning paradigm saying that hrd actually aims at enhancing the learning capacity of individuals, groups and organizations through developing and using learning based interventions so that organizational growth and effectiveness is optimized. structure of organization both the paradigms have different stands in respect of structure of organization. in this regard, harrison & kessels (2003) say that till the end of the 20th century the structure of the organization was considered a static concept as the formal strategic decisions of the management conceived them to be. but when the age of knowledge economy started, it was acknowledged that regular structural reconfiguration of the organization must correspond to continuing changes in strategy when new stocks and resources within the organization are acquired or existing ones transferred to other sites and when the firm creates value through an interaction with its customers. in other words, strategy and structure need to become interactive processes that cause the continuous creation, acquisition and exploitation of knowledge and expertise in the domain of a firm. instructional interventions as regards the interventions used for the improvement of performance, both the paradigms are at cross purposes. peters (2007) criticizes performance paradigm in connection with short-term interventions which are employed to improve performance and they address only a single aspect of performance. peters elaborates his point thus: “for example, a training program designed to increase the ability of people to work on high performance teams is often rendered useless by an unsupportive or even hostile culture and the negative attitudes of participants who realize this is ‘just not the way we do things around here’ (p.4).” through this example, peters wants to say that the training gives knowledge and skills to perform on the respective task and not to address the cultural and attitudinal issues (hostile culture and poor attitudes) that create un-surmountable hurdles for the trainees. in short, narrow trainings given under performance paradigm do not enable functionaries of an organization to transfer their limited and local learning to their jobs and little improvement takes place in overall performance. harrison & kessels (2003.) but these researchers suggest that for adding critical value in a knowledge economy by hrd process, lifelong learning and work-based strategies should be given priority as compared to giving focus on immediate performance improvement. this preference is necessary because in knowledge economy, hrd experts should go for learning processes that can generate and spread knowledge for enhancing south asian review of business and administrative studies vol. 2, no. 1, june 2020 123 the organization’s capability to improve and innovate continuously. these researchers continue to say that “in a knowledge-based economy the source of competitive advantage cannot be knowledge as organizational commodity alone, since the value of all commodities is eroded by obsolescence, imitation and poaching. what is needed is a new paradigm of the organization one that presents it as a system of learning and knowing processes and activity that are situated in workplace communities of practice (p.8).” the stand of learning paradigms seems more valid when the current world is seen in respect of rapid changes and novel and uncertain developments. motivation of the workers the advocates of both the paradigms are in different camps with the reference to how the motivation of workers occurs. focusing on the position of performance paradigm, peters (2007) says that the organizations that follow performance paradigm, through narrowly focused interventions to address complex performance problems, create more and more management problems and ultimately management credibility is destroyed. their employees begin to develop negative attitudes and management becomes frustrated despite its continued investment and things do not seem to improve. this situation turns into trust deficit and blaming and ultimately adversarial relationship develops between management and employees. in the same line franklyn (2009) criticizes the ways of motivation followed in performance paradigm. he says that in performance paradigm personnel management typically tries to motivate employees through compensation, bonuses, rewards, and the simplification of work responsibilities. this approach is followed because, according to the personnel management, employees’ satisfaction generates the required motivation necessary for the improvement of job performance. franklyn is of the view that it is not the satisfaction of the employees that leads to motivation and improvement of job performance but it is improved performance that brings about employees satisfaction. opposite to the advocates of performance paradigm, human resource management considers work groups, effective strategies for meeting challenges, and job creativity (attributes of learning paradigm) are the primary motivators. both the paradigms share a common ground the scopes and aims of performance paradigm as well as learning paradigm have been examined above. if performance paradigm is utilized, optimal performance that is the objective of hrd process cannot come out until integrated learning does not play its role. wang & huang (2013) observe that predominant paradigms in human resource i.e., performance paradigm and learning paradigms, both exist side by side. the scholars have recently acknowledged that both paradigms are not mutually exclusive. it follows from this view that these paradigms should not be presented as contestants but needed to be integrated as complementary ones. hu (2007) also acknowledges that both the paradigms share the common ground in the area of theoretical foundations of hrd. on account of this sharing various learning theories added new knowledge to the conceptual framework of hrd and have become popular in hrd practice. particularly, learning theories like reflective learning, experiential learning, transformative learning and social learning have firmly won space in the arena of human resource development research as well as practice. discussion it has been seen in the observation above that the performance paradigm cannot bring in sustainable and effective performance and growth. on the other side the learning paradigm seems promising because it can endow capacity to human beings to interact and solve complex performance problems or attitudes that can prove roadblocks in the path of performance. but at this stage two questions arise: 1. what is required through learning? south asian review of business and administrative studies vol. 2, no. 1, june 2020 124 2. how learning can be processed and promoted to generate the required learning capacity in human resource? target of hrd focus of the first question given above is the target of hrd. this target may be defined as the optimal performance of an organization. rationale of this target and so far efforts made and movements launched to achieve it have been mentioned in the beginning of this paper. in simple words, this target is the achievement of a matchless position of an organization on account of a unique learning capability of its workforce. a familiar term, ‘sustainable competitive advantage’ can introduce the said matchless position well. wright et al. (1992 cited in hu, 2007) suggest criteria for a sustainable competitive advantage and then mention conditions in which human resource can meet these criteria: human resource must provide value to the organization and they must be rare, inimitable and must not have substitute. strategies for hrd success the second question given above pertains to the way the hrd professionals need to process and promote learning to achieve their target of optimal learning or sustainable competitive advantage through enhancing the learning capacity or capability of human resource. in the words of 2007 strategic review their challenge is to fill “the gap between current staff competences and the desired staff competency profile (p.51).” filling this gap has a high demand on the hrd professionals. to meet this demand following strategies can be effective. reciprocal learning human societies have made economic and social progress with the help of learning and development of knowledge which were acquired through information sharing process. although the knowledge increases with sharing, yet it stays in individual and collective subconscious of human beings which is commonly known as tacit knowledge. human beings retrieve and utilize this knowledge unconsciously in their routine and skill-based tasks. according to held (2012) employees generate the knowledge on reciprocal basis. but the knowledge produced thus does not aggregate itself to the level of the organization. within the organizations, groups are founded where employees share their understanding, interpretations, attitudes and knowledge. this process leads to group level learning. the knowledge that thus comes into existence within these groups becomes institutionalized as an organizational product. for the sake of learning and knowledge generation employees should be able to interact and work independently in different compartments of the organization. on the other hand the organization should utilize the learning capacity of its employees. it should rather make goals and structures obvious and enhance the culture of sharing to develop a culture of learning. in line with held, harrison & kessels (2003) say that envisaging the importance of partnership process, now more attention is being directed to ways how workplace communities can be brought together and make them share organizational purpose while keeping intact the unique self-regulating characteristics which are very dear to individuals and so powerful in driving the knowledge process. it follows from this position that in a knowledge-creating organization focus should be more on finding new ways to make people think creatively and feed their thoughts back into the organization as compared to developing systems to control learning or to manage knowledge. further, focus should be on to provide the skills and support systems that are required to manage the projects that emerge from that creativity. continued learning the 21st century is an age when things are happening and developments are taking place on fasttrack basis on account of exceeded interconnectivity and global economy. it means the current age is a dynamic age and the workers of this age need to update their learning as the life go forward. south asian review of business and administrative studies vol. 2, no. 1, june 2020 125 anonymous (n.d.) emphasizes the continued learning for the purpose of updating people about the latest technology, skills, etc. this type of learning can generate high skilled and flexible workers and managers; career development opportunities; employment and retaining opportunities; and promoting creativity and technological development within the workforce. in view of this type of needs, the hrd professionals should try to cause continued learning. training and development employees’ training and development is generally required when some changes occur in the way of doing things on account of technology or organizational developments. and the purpose of training is to enhance employees’ performance and productivity. according to duke & udono (2012) training generally pertains to “upgrading, re-tooling and skills-optimization activities... training and development usually come in the form of orientation, skills training and executive development... this activity has implications, not just for raising employees’ skills levels, but also for increasing their motivation – a factor that is critical for job satisfaction, productivity and long term commitment to the organization (p.160).” seeing the importance of training, the professional develop training programmes and provide for the human resource on continuous basis. however, they should understand that the success of a training activity depends on this condition that the learning occurred in training can be transferred to the job situation or newly gained skills are put into use. perceptions, attitudes and behaviours of employees in respect of the success of an organization which in its turn becomes possible only through positive perceptions, attitudes and behaviours of the employees. according to peters (2007) in connection with the employees’ performance, their perceptions are important because they are thought to precede individual behavioural reactions which are the most direct reaction to hr practices. it is also important to note that employee’s perception is the result of the learning the employee does. held (2012) also emphasizes that it is very important to consider employees’ perception. employees’ positive perception about hr practices will ultimately cause improved performance. there are three sorts of hr practices: (1) the intended hr practices, (2) implemented hr practices, and (3) perceived practices. it is required to understand how hr practices are implemented in the light of the intentions of the organizations while incorporating the employees’ perceptions. here the point is that that employees perceive about the opportunities for learning in a different manner as compared to the approach of a manager. however, managers can promote the learning of their employees through shaping a work situation and rewards. now the question is how attitudes, that may prove restraints in the path of performance, can be changed. hase & davis (1999) inform us about the way attitudes can be changed. they say that for changing attitudes first changes should be made in behaviour. and this can be done successfully through work activity and pre-start meetings. incidental learning anonymous (n.d.) says that learning at work is usual but incidental learning is which occurs during the performance of tasks. various new facts and theories emerge when the workers are engaged in their work. this emergence provide chance to learn new things and this learning adds to the motivation of workers. however, chances of this type of learning are very few according to harrison & kessels (2003) in workplaces where technology is being used increasingly. in the absence such chances, motivation to learn new tasks, develop new work behaviours and master new work practices is a great requirement. the problem of less motivation can arise because technology cannot build the required motivation. in this situation hrd experts should come forward and try to promote productive social interaction in and across teams. south asian review of business and administrative studies vol. 2, no. 1, june 2020 126 conducive work environment conducive work environment is an atmosphere that is quite essential for realizing effective performance in business organizations. building and sustaining knowledge-productive enviroment demands expertise and credibility from hrd professionals. according to harrison & kessels (2003) for the purpose of producing positive environment, professionals require to master strategizing, organizing and hrd processes supportive for innovative organizational forms. through these skills they can create among employees the interacting type of competencies, i.e., strategic capability, flexibility and learning orientation. learning capacity/capability co-occurring of knowledge economy and globalization has led hrd scholars to the conclusion that innovation and flexibility instead of efficiency are the main drivers of value and competitive advantage can be achieved through capability to adapt to and meet unfamiliar challenges by producing and applying new knowledge to continuous improvement. harrison & kessels (2003) make it clear that “in an economic environment where knowledge is becoming the main organizational currency, firms must be able to learn fast, respond to recurrent unfamiliar challenges, and ensure that their workers can construct and share strategically valuable knowledge as well as acquire technical and interactive skill (p.1).” in short, in the current turbulent times the thing which is required is learning capacity or capability. according to held (2012) the learning capacity is the form of superior or enhanced learning that should be installed at the individual, group and organizational level. this capacity enhances the employee’s knowledge/awareness regarding how to learn. hase & davis (1999) call this learning capacity ‘capability’ and says that capable people know how to learn; they are creative; have a high degree of self-efficacy; can apply competencies in new as well as familiar situations; and work well with others. further, these researchers differentiate between competency and capability saying competency pertains to the acquisition of knowledge and skills and is an essential ingredient of being capable, whereas capability is a holistic attribute. as capable people possess ‘all round’ capacity, they are more likely to be able to effectively handle the critical circumstances when they face them in workplaces. in the light of the views given above it is recommended that the hrd professionals orient and enable their human resource to produce and apply knowledge. transference acquiring knowledge is one thing and its application is another thing. a general drawback of training programs in performance paradigm is that information is given to the participants; they remember it but cannot use it in new environments. the thing they actually require is the ability of transfer. explaining the concept of transference, westover (2008) says “transference refers to one’s ability to use the information and skills attained through training in a new environment, ideally the work environment (p. 6).” certain factors can increase the likelihood of transference. particularly, association and similarity are more prominent. for example, trainees can associate newly received information with something already in their minds or if they receive information that is similar to their previous information, more transference will occur. knowledge competencies in business organizations, workers need to perform many activities. for the performance of such activities they require some procedural or regulative knowledge which can be called as knowledge competencies. this type of knowledge is generally acquired through formal education, training and experience. lindner (2001) elaborates this concept saying, “some human resource management knowledge, such as constructing a markov matrix, would almost always be acquired through formal education. other knowledge, such as conducting an interview may be acquired through training and life experiences (p.342).” it is necessary that employees acquired knowledge south asian review of business and administrative studies vol. 2, no. 1, june 2020 127 of human resource policies and practices e.g., laws and regulations to perform hrm activities. for the effective performance of hrm activities, hrd professionals should supply this kind of knowledge to their employees. conclusion this study is conceptual and non-empirical. this is its main limitation. there is a need for further empirical study so that approach suggested in the paper can gain an established effect. further, since the things stated in the paper are essentially recommendary in nature and in no way prescriptive, other complementary information gleaned conceptually or empirically will be useful. it is recommended that strategies, to realize optimal performance, suggested in this paper be empirically tested for their effect in a context of an organization. in the present day world where things are changing rapidly and new developments are taking place in an uncertain manner; where people require decent employment and societies require peace and development, the human resource needs be developed and utilized in a very efficient manner. for this purposes various approaches have been employed so far. particularly, performance paradigm and learning paradigm are worthy of note. however, both these paradigms have not succeeded in providing the complete answer to the question how optimal performance can be ensured. the researcher has the view that these paradigms are complementary to each other and the problem of optimal performance would not be solved by sticking to one of the two. rather, learning paradigm need be restructured to incorporate a number of strategies following which it may become possible to process and promote learning to realize the optimal learning which in its turn generate possibilities for firms to attain the position of sustainable competitive advantage. references anonymous (n.d) uman_resource_development_importance_of_learning_in_ people _develo pment, braviaresearchpapers.com/.../ retrieved on 25 october 2014 duke, j. & udono, e. n. 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(2008) skills development for employment: scope and strategies, a paper presented at international conference in bali/indonesia, 24-26 november 2008 in partnership with unesco-unevoc international centre (bonn) and the southeast asian ministers of education organization regional centre for vocational and technical education and training (seameo voctech) wang, y-l, & huang, s. (2013) organizational learning and human resource: a review of the theory and literatures ipedr. 2013. v61. 12 westover, j. h., (2008) effective human resource training and development: examination and application of adult learning theory in the hr management context the journal of human resource and adult learning vol. 4, num. 1, june 2008 wright et al. (1992 cited in hu, p. 2007) theorizing strategic human resource development: linking financial performance and sustainable competitive advantage, in f.m., nafukho & t. chermak (eds.), proceedings of the academy of human resource development 2007 international research conference. fayetteville, ar: university of arkansas. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 75 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas the shopping movement at the neighborhood: the best solution to increase zakat of trade in indonesia nurdin batjo, palopo state islamic institute, indonesia muhammad alwi, palopo state islamic institute, indonesia nasrullah nursam, palopo state islamic institute, indonesia nadya mulyasari, palopo state islamic institute, indonesia article details abstract history revised format: nov 2021 available online: dec 2021 keywords shopping at neighbor's stalls, solutions, commercial zakat this study examines the best solution to increase commercial zakat. this study aims to determine the public's understanding of zakat, to determine public knowledge about the movement and benefits of shopping at neighboring stalls, as well as the potential for increasing trade zakat through shopping movements at neighboring stalls. this type of research is qualitative phenomenology, data collection techniques through interviews with sources and used as primary data. the study concluded that: 1) the main sources of information about zakat came from mosques 33.3%, friends 15.7%, social media/internet 14.3%. understanding of trade zakat who understands (knows and knows very well) is 60%, slightly understands 23%, and those who do not understand 17%. this result is corroborated by knowledge of the zakat recipient groups where 23% mention 4 to 8 groups, 71% mention 1 to 3 groups, 6% do not mention the recipient groups; 2) the shopping movement at a neighboring shop is known by 67% of respondents, and 33% of respondents who do not know. benefits of shopping at neighboring stalls: a) increasing microeconomy 33%; b) alms / sharing to neighbors 26.9%; c) friendship / brotherhood 25%; and d) easy to get the needs of 14.1%. the intensity of shopping to the neighboring shop is 79% often, and 21% rarely; 3) if this movement is implemented, respondents will increase their shopping at neighboring stalls by 59%, no longer shopping at national retailers by 3%, but there are still 38% who continue to shop as usual. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: nurdin_batjo@iainpalopo.ac.id doi: https://doi.org/10.52461/sabas.v3i2.740 introduction development is not only related to economic capital, but also social capital related to economic capital. social capital has the power to influence the principles that underlie the economic progress and social welfare of a country. countries with high social capital have a tendency for high https://journals.iub.edu.pk/index.php/sabas mailto:nurdin_batjo@iainpalopo.ac.id https://doi.org/10.52461/sabas.v3i2.740 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 76 economic success and quality. on the other hand, countries with low levels of social capital tend to have slower and inferior economic progress and behavior. in the context of islam, islam has a strong foundation for building a society that is committed to social capital. islam has a commitment to social contracts and norms that have been mutually agreed upon; and the basic characteristics of muslim community building are ta'awun (please help), takaful (bear each other), and tadhomun (have solidarity) (dzikrulloh, and permata, 2019, p. 49). islam is the teachings of rahmatan lill alamin, whose main goal is to bring prosperity, blessing, peace and security to all mankind in the world. in addition, islam teaches to help each other among human beings. what's more, allah swt has given natural resources, and others in such a large amount for humans to use as caliphs on earth. indonesia's majority population is muslim, so it has the potential to be developed into an instrument of income distribution, especially for the muslim community. the concept of helping in islam is reflected in the human obligation to pay zakat (habib, 2016, p. 1). zakat is a property that must be issued by a muslim or business entity to be given to those who are entitled to receive it in accordance with islamic law. with zakat we realize that islam is a socially caring religion that cares for the underprivileged, the management of zakat has been regulated in law number 23 of 2011 and has been implemented especially in baznas (riyan ramadhan sahri at al. 2020, p. 487). on the other hand, the potential for community zakat originating from trade zakat is increasingly being eroded due to the increasing number of consumers who in fact 85% are people who shop at national franchise and retail outlets whose ownership is not by muslims, so the potential for trade zakat is not obtained from the consequences of this. the. the image below shows the movement of alfamart and indomaret outlets still expanding and their dominance is getting stronger in indonesia. source: tbk, at 2018 indomaret and alfamart still look expansive until the middle of 2018. this is reflected in nielsen retail audit data which shows the number of indomaret outlets in june 2018 increased by 300 units to 15,526 outlets from the january position. similarly, alfamart increased by 32 units to 13,522 outlets and alfamidi increased by 59 units to 1,478 outlets from the initial position of the year (tbk. 2018). 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 alfamidi alfamart indomaret table 1. number of national retail outlets juni 2018 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 77 relevant past research in the study of optimizing zakat potential through shopping movements at neighboring stalls, the authors found some literature that can be divided into three major groups, namely: the role of national zakat amil agency (baznas), merchant participation, and zakat potential. below are some research results that are highly correlated with the author's proposal, namely: table 2. relevant past research writer's name research dimension focus type technique case results kanalakum b., and edward y., 2018, p. 135-147. baznas's efforts to increase the collection of trade zakat qualitative observatio n and interview baznas kab. kuantan singingi optimizing the media for brochures, banners and on social media containing information on zakat rahman m., and fitrianto h., 2019, p. 1-16. merchant participation in paying trade zak at qualitative interview kuantan district baznas singingi the participation of traders is still lacking in paying trade zakat to baznas, kuantan singingi regency susanti s., hamzah a., and sari m., 2020, p. 66-72. traders perceptions of commercial zakat qualitative interview batik entrepreneurs in full river city entrepreneurs' perceptions are still very minimal, some even don't know about commercial zakat dhikrulloh, and gems are, 2019, p. 46-58 optimization of zakat to overcome poverty problems qualitative study of literature indonesia the huge potential of zakat in indonesia must be optimized to the maximum lestari or, fauziah ne, and maryandi y., 2019, p. 449-454 implementation of trade zakat by traders qualitative field research new market in bandung traders who spend their trade zakat by 76% renewal (nurdin batjo) the potential of the ummah increases the number of muzakki qualitative approach to phenomen ology interview commercial zakat and shopping movement at neighboring stalls benefits of shopping at neighboring stalls: improving microeconomy; alms; friendship; easy can need. the movement will increase the share of spending in neighbors 62%. source: summary of some relevant past research, 2021 this research can contribute theories about the potential of the ummah, optimizing the potential of commercial zakat, and methods of increasing muzakki. in addition to contributing theory, this research can also strengthen and correct the commonly used methodologies. and this research can enrich the data in the potential of the ummah and commercial zakat. literature review the islamic economic system prohibits the accumulation of wealth by a group of people. islam teaches equitable distribution of wealth by distributing wealth, in this case zakat. zakat is the most effective and essential instrument that is not found in the capitalist or socialist system. economically, zakat has a distributive function, namely: redistribution of income from muzakki to mustahik. zakat is issued at a special time, in the sense that the ownership is complete for a year south asian review of business and administrative studies vol. 3, no. 2, dec 2021 78 (hawl), both property in the form of livestock, money, and merchandise, as well as seeds (rice or field products), fruits, mining goods, income and profession (according to some scholars'), all of which must be paid zakat. zakat is the fulfillment of obligatory rights contained in assets. zakat is also intended as a part of certain assets and which is required by allah to be given to the poor (dzikrulloh, and permata. 2019, p. 51). discussing the issue of commerce is certainly very interesting, because this work is the same as that carried out by the prophet and his companions, including jobs that have the opportunity for 9 parts of sustenance out of 10 existing divisions. included in the category of commercial property are everything that was originally intended to be traded for profit (tho'in m., et al. 2020, p. 58). at present, commercial zakat has a tremendous impact and influence on the progress and economic growth of the ummah. if zakat management can be implemented and managed properly, there will be trust among the zakat payers (muzakki) towards the zakat amil. zakat is also very helpful in the economic growth of the ummah, in fact it overcomes social symptoms such as poverty and creed problems (munawwar, hafsah, and yamamah. 2018, p. 138). potential zakat in indonesia to optimize the role of zakat as social capital that can alleviate poverty, the amil zakat institution needs to take strategic steps, namely the implementation of good corporate governance at the amil zakat institution, implementing the digitization of the amil zakat institution management system and synergizing collaboration and collaboration with other institutions in accordance with vision and mission of the amil zakat institution. this program will encourage awareness of public trust in amil zakat institutions. the strategy carried out will also encourage ease in the management, collection and distribution of zakat funds so as to increase muzakki as well as increase zakat funds which can then be distributed and reported in a transparent and accountable manner (dzikrulloh, and permata. 2019, p. 57). the research shows that the implementation of zakat mal management policies through the national amil zakat agency (baznas) is still not optimal, seen from several influencing factors such as the lack of public awareness (muzakki) to issue zakat; less than optimal socialization of policies on zakat management; and the lack of public trust in the government in this case baznas (suherman. 2020, p. 67). similar to taxes, payment of zakat is an obligation, has rules and regulations that have been set, and is addressed to certain parties who meet the requirements. the difference is that zakat is imposed on every muslim who meets the requirements throughout the world while taxes are imposed absolutely on every citizen within the territory of a country regardless of what religion they profess. indonesia as the second largest islamic country in the world has a very large potential to receive zakat funds, reaching up to 217 trillion per year. but unfortunately, the potential for large zakat funds is not accompanied by the realization of the large amount of zakat funds received (alpriyamah, and adityawarman. 2017, p. 1-11). furthermore, it is said that the factors that can affect the behavior of compliance with the payment of commercial zakat. these factors can come from within the individual such as attitudes and intentions as well as factors that come from outside the individual such as subjective norms that affect the compliance behavior of commercial zakat payments. shopping movement at the neighbor's stall buying at a neighbor's shop will grow the family's economic strength. we have a role to play in maintaining the economy and resilience of a family. husband, wife and children. and they, acting as sellers. entrepreneurship. it's not just being a servant or a slave of the owners of liberal capitalist capital who argues for the uniform of employees. imagine, how old are modern shops willing to employ these waiters? only at a young age. meanwhile, by becoming a "seller" they will actually be "supported" even until their children grow up (asyhar. 2017, p. 1) south asian review of business and administrative studies vol. 3, no. 2, dec 2021 79 current social studies, the above guidelines give an understanding that spending wealth to provide benefits can be in the form of charity or consumption. charity is aids to ease the burden of life for those who are in need. consumption is the use of wealth to meet personal and family needs. the shopping movement at the neighboring stalls is carried out by buying daily necessities at our neighboring stalls. also by not buying elsewhere as long as our neighbor's stall is there at a reasonable price. prioritizing shopping at neighboring stalls is part of carrying out the message of the prophet to honor neighbors. it was narrated by sahih bukhari 5671 and sahih muslim 69: that the prophet saw said, "whoever believes in allah and the last day, let him do good to his neighbors" (hadis, 2021). methodology the type of research in this study is qualitative phenomenology. the study used primary data from sources. secondary data comes from books, previous studies and various reading sources related to zakat, shopping movements at neighboring stalls and the benefits of shopping at neighboring stalls, as well as the potential for commercial zakat funds if the shopping movement at neighboring stalls goes well. the data collection method in this study used interview techniques, and the data obtained were tested for validity using theoretical triangulation techniques. data or information from one party is checked for correctness by obtaining information from other sources. results and discussion based on the research carried out, the research results obtained in the form of tables which are shown below: characteristics of resource person the characteristics of the respondents are 50% male and 50% female. has a range of ages between 21 to 55 years, which is dominant at the age of 26 to 30 as much as 44%. the dominant high school education is 48%, high education is 46%. employment 51% employees / entrepreneurs, 21% employees / civil servants, and 16% housewives. have marital status, 51% married, 44% single and 5% widowed/widowed. understanding of zakat table 3. sources of information about zakat for no. resources male resource person female resource person subtotal % amount % amount % 1 mosque / ustadz 25 34.7 24 32 49 33.3 2 friends 12 16.7 11 14.6 23 15.7 3 family 9 12.5 5 6.7 14 9.5 4 social media / internet 8 11.1 13 17.3 21 14.3 5 school / books 7 9.7 8 10.7 15 10.2 6 baznas 5 6.9 8 10.7 13 8.8 7 local government 4 5.6 3 4 7 4.8 8 television 2 2.8 1 1.3 3 2.0 9 laz 0 0 2 2.7 2 1.4 total 72 100 75 100 147 100 source: research data after processing, 2021. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 80 the results of the study show that the mosque is the most effective means to socialize zakat, which is 33% of sources of information for informants in obtaining knowledge about zakat, while the accumulation of baznas and amil zakat institute (laz) as institutions in zakat management is only 10.2%. meanwhile, friends and family have accumulated 25.2% of information contributors about zakat. but there is an interesting fact, namely the source of information about zakat is obtained from social media / internet 14.3% and schools / books 10.2%. the results above can be a source of information for baznas and laz as institutions that handle zakat that must intensively schedule regular zakat discussions in mosques outside the month of ramadan. so that these activities can better understand the public about zakat mal, including commercial zakat, and not only discuss zakat fitrah. potential data is through schools or formal educational institutions, baznas institutions can also collaborate with the ministry of education so that material on zakat can be inserted between monotheism and prayer material so that the understanding of the younger generation is educated with shari'a coloring. and what baznas has the potential to do for its program to understand the community about zakat is through social media or the internet. it can be used as an interactive youtube media by uploading the operational functions of baznas, namely the collection, distribution, and utilization of zakat. so that subscribers continuously get information about zakat. recommendations for the use of social media / internet are in line with the results of bima kanalum's research which examined "baznas efforts to increase the collection of commercial zakat". tithe (kanalakum b., and edward y., 2018, p. 135-147). table 4. knowledge of commercial zakat no. knowledge of commercial zakat male resource person female resource person sub total and % amount % amount % 1 do not know 9 18 8 16 17 2 know a little bit 13 26 10 20 23 3 know 18 36 25 50 43 4 very know 10 20 7 14 17 total 50 100 50 100 100 source: research data after processing, 2021. the data presented in the table above is the accumulation of resource persons who are very knowledgeable and know about commercial zakat by 60%. meanwhile, the accumulation of resource persons who know little or even no knowledge of commercial zakat is 40%. this result is quite sad because the informants are aged 21 to 55 years and are muslim, and it turns out that there are 23% who know little and 17% who do not know at all. this result is in line with the research of susi susanti, et al., with the theme "perceptions of traders about commercial zakat" with the results of the study that entrepreneurs' understanding of commercial zakat is still very low, and there are even entrepreneurs who do not know about commercial zakat (susanti s., hamzah a. ., and sari m., 2020, p. 66-72). these two studies are very sad because it is not only the general public who are muslim who do not know anything about commercial zakat, it turns out that there are also many entrepreneurs who do not know about the existence of commercial zakat. this result is also most likely the cause of the lack of participation of traders in paying trade zakat to the baznas of kuantan singingi regency (rahman m., and fitrianto h., 2019, p. 1-16). south asian review of business and administrative studies vol. 3, no. 2, dec 2021 81 table 5. respondents' answers about zakat recipients no. the group of beneficiaries of zakat male resource person female resource person sub total and % amount % amount % 1 not mentioning the group 4 8 2 4 6 2 mention 1 group 16 32 10 20 26 3 mention 2 groups 15 30 16 32 31 4 mention 3 groups 2 4 12 24 14 5 mention 4 groups 3 6 2 4 5 6 mention 5 groups 4 8 0 0 4 7 mention 6 groups 0 0 0 0 0 8 mention 7 groups 0 0 2 4 2 9 mention 8 groups 6 12 6 12 12 total 50 100 50 100 100 source: research data after processing, 2021. the results of the study by asking informants about the groups of zakat recipients, it was found that 6% who did not answer the zakat recipient groups, those who mentioned between 1 and 3 groups were 71%, and those who said between 4 and 8 groups were 23%. if the results are analogized into three groups, it is found that the respondents who do not know the group of zakat recipients are 6%, those who know the group of zakat recipients are 71%, and really know the group of zakat recipients are 23%. this result is a challenge for baznas and laz in finding solutions in the form of work programs so that the understanding of the ummah about zakat can increase so that increased understanding will also increase community participation in zakat and increase zakat potential. movement and benefits of shopping at the neighbor's warung table 6. respondents' answers regarding knowledge of the existence of a shopping movement at a neighboring shop no. knowledge of movement male resource person female resource person sub total and % amount % amount % 1 do not know 19 38 14 28 33 2 know 31 62 36 72 67 total 50 100 50 100 100 source: research data after processing, 2021. the results showed that the shopping movement to neighboring stalls was not known by 33% of respondents, and there were 67% of respondents who were aware of the existence of shopping movements to neighboring stalls. this result is a hope and a challenge where 67% of the informants are hopeful that they will be able to make the shopping movement a success at a neighboring shop. however, 33% of the informants were a challenge as the initial target of socializing the shopping movement at a neighboring shop. the implementation of the socialization of the movement is supported by qs al-'asr 103:3 below: ْبِرࣖ ِ ەۙ َوتََواَصْوا بِالصا ٣ -اَِّلا الاِذْيَن ٰاَمنُْوا َوَعِملُوا الصِّٰلٰحِت َوتََواَصْوا بِاْلَحق south asian review of business and administrative studies vol. 3, no. 2, dec 2021 82 translate: except those who believe and do good deeds and exhort one another to truth and exhort one another to patience. (surat al-'asr 103:3) (quran, 2021) the verse clearly states that people who do not lose are if they believe in allah, then do good, and benefit others by giving advice on truth and patience. so that the implementation of the socialization of the movement is to give advice on the truth, if the socialization is accepted then you must be grateful and if it has not been accepted by the person who was given the socialization then you must be patient. this movement has been supported nationally by regents, mayors, governors and up to the president through his ministers. this is proven through the banyumas regent, through the chair of the banyumas regency pkk mobilization team, mrs. erna husein (banyumas, k. 2020), then in july 2020, the samarinda city government plans to hold a shopping movement for neighboring stalls or stalls around their homes (today). k. 2020), then a statement from the expert staff of the south sulawesi provincial government for economic affairs, irman "none" yasin limpo, said that the community played a role in creating strong micro small and medium enterprises (msmes). one thing that can be done is to promote the shopping movement at warung neighbors (fajarnews. 2020), then supported by the president through the ministry of cooperatives and small and medium enterprises (smes) to launch a shopping program at neighboring stalls as an effort to maintain people's purchasing power for msme products (liputan6.com. 2020). table 7. benefits for the community if you shop at a neighboring shop, answers from male sources no. the benefits of shopping at a neighbor's shop male resource person female resource person subtotal % amount % amount % 1 improve micro-economy 34 50 19 21.6 53 33 2 alms / share with neighbors 7 10.3 35 39.8 42 26.9 3 friendship / brotherhood 16 23.5 23 26.1 39 25 4 easy to get needs 11 16.2 11 12.5 22 14.1 total 68 100 88 100 156 100 source: research data after processing, 2021. after asking openly so that the number of answers is expected to be more than one to the informant about what are the benefits for the community if shopping at a neighboring shop is to improve the micro-economy of the community 33%, alms / sharing with neighbors 26.9%, friendship / ukhuwah 25%, and ease of obtaining needs 14.1%. these results show that people's understanding of the importance of improving the micro-economy can be achieved through shopping at neighboring stalls, 33% of which are in first place. the next ranking can be grouped into social benefits, namely alms / sharing with neighbors and friendship / ukhuwah with a total value of 51.9%, which is a very dominant value. then the benefit for the individual himself is the ease of obtaining needs of 14.1%. the first benefit of shopping at a neighboring shop is the increase in the micro-economy, where the circulation of money will circulate among small people so that the economy will be better and more resilient in the event of a crisis in indonesia. this is supported by the paragraph below. ْۗ ْم ُ ك ْ ِء ِمن ۤ ا ِنيا ْ غ ا ْ نا اْل ي ْ ا ۢ ب ً ة َ ْول ُ د ا ْون ُ ك ا ي ا ْ َل ي َ .... ك translate: south asian review of business and administrative studies vol. 3, no. 2, dec 2021 83 so that the treasure does not only circulate among the rich among you ... (surah al-hasyr 59:7) (al-quran. 2021). this verse explains the habit of ignorant and greedy people is to want to get and control many economic factors so that a monopoly occurs which causes wealth to accumulate only to a few people. the second benefit related to social alms and friendship / ukhuwah which totals 51.9% is strongly supported by the verse below: بِِذى اْلقُْرٰبى َواْليَٰتٰمى َواْلَمسٰ بِاْلَواِلدَْيِن اِْحَسانًا وا َ َوََّل تُْشِرُكْوا بِٖه َشْيـًٔا وا ِكْيِن َواْعبُدُوا ّٰللاّٰ ِب َواْبِن السابِْيِلۙ َوَما َملََكْت اَْيَمانُُكْم ۗ َواْلَجاِر ِذى اْلقُْرٰبى َواْلَجاِر اْلُجنُِب َوالصااِحِب بِاْلَجْنْۢ َ ََّل يُِحبُّ َمْن َكاَن ُمْختَاًَّل فَُخْوًرۙا ٣٦ -اِنا ّٰللاّٰ translate: and worship allah and do not associate anything with him. and be kind to your parents, close friends, orphans, poor people, near and far neighbors, colleagues, ibn sabil and slaves that you have. indeed, allah does not like people who are arrogant and proud. (surat an-nisa' 4:36) (quran. 2021) this verse can be used as an explanation of the order of doing good to neighbors when selling, namely prioritizing shopping at neighbors who are close relatives, then to neighbors who are orphans then poor, then to close neighbors and then to distant neighbors. so that with shopping we can get closer to our neighbors by providing benefits for the profits we buy. besides that, shopping at a neighbor's shop will establish friendship / ukhuwah even though our neighbors are not muslims. table 8. intensity of resource persons shopping at neighboring stalls no. the intensity of shopping at the neighboring stall male resource person female resource person sub total and % amount % amount % 1 very rarely 3 6 1 2 4 2 seldom 8 16 9 18 17 3 often 14 28 18 36 32 4 very often 25 50 22 44 47 total 50 100 50 100 100 source: research data after processing, 2021. the results of the research above, if grouped into two parts, will get the results that, shopping sources at neighboring stalls have a rare intensity of 21%, while those who shop with frequent intensity are 29%. this result is quite encouraging because the value for shopping at a neighboring shop with intensity is often 79%. however, it should be noted that we are in indonesia, which has eastern customs and a very high social spirit, but there are still 21% of respondents who rarely shop at neighboring stalls. the results of the research above are strongly supported by the two hadiths which are written below: ُ َعلَْيِه َوَسلاَم اْلَجاُر أََحقُّ بَِسقَبِِه ِمْن َغْيِرِه ١٨٦٥٠مسند أحمد ِ َصلاى ّٰللاا : قَاَل َرُسوُل ّٰللاا قَاَل أَبُو َعاِمٍر فِي َحِديثِِه اْلَمْرُء أََحقُّ south asian review of business and administrative studies vol. 3, no. 2, dec 2021 84 musnad ahmad 18650: the prophet sallallaahu 'alaihi wa sallam said: "a neighbor is more entitled to be neighbors (invited to social interaction) than others." abu amir said in his hadith: "al mar`u (that person) is more entitled." (hadis. 2021) فَقَاَل : أَناهُ بَاَع ِمْن َرُجٍل نَِصيبًا لَهُ ِمْن دَاٍر لَهُ فِيَها َشِريٌك ,٤٤٨٤سنن الدارقطني ِ َصلاى هللاُ َعلَْيِه َوَسلاَم , فَقَالَ : َشِريُكهُ: أَنَا أََحقُّ بِاْلبَْيعِ ِمْن َغْيِري , فَُرفَِع ذَِلَك إِلَى النابِي »اْلَجاُر أََحقُّ بَِسقَبِِه« sunan daruquthni 4484: that he once sold someone his share of a house which was shared with a partner, and the partner said, 'i have more rights to the sale than anyone else.' then he complained to the prophet saw, so he said, 'the neighbor is more entitled because of his proximity'." (hadis, 2021) where the hadith of musnad ahmad states that the most entitled to be invited to socially interact with neighbors so that this hadith is a rebuttal to the sources, amounting to 21% who rarely interact with their neighbors through shopping. however, this needs to be investigated whether the resource person continues to interact socially with his neighbors but is represented by his other family for shopping. meanwhile, the hadith of sunan daruquthni asserts that the first person entitled to receive an offer for the sale of an item is the neighbor and vice versa, the neighbor is also obliged to purchase goods from a neighbor's shop. the potential of commercial zakat through shopping movements at neighboring stalls zakat is a property that must be issued by a muslim or business entity to be given to those who are entitled to receive it in accordance with islamic law. zakat mal includes one of them is commerce. zakat mal as referred to in paragraph (2) is an asset owned by an individual muzaki or a business entity. total franchise outlets as of january 2018, for indomaret 15,526 outlets, alfamart 13,522 outlets, and alfamidi 1,478, for a total of 30,526 outlets. with a standard daily turnover in each outlet, a minimum of idr 17,000,000. then the daily turnover = 30,526 x idr 17,000,000 = idr 518,942,000,000/day assuming that muslims shop for 85% then: = idr 518,942,000,000 x 85% = idr 441,100,700,000 / day (365 days / year) = idr 441,100,700,000 x 365 days = idr 161.001.755.500.000 / year = idr 161 trillion per year potential zakat on trade = assumed net profit 10% x 2.5% = (rp 161 t x 10%) x 2.5% = idr 16.1 t x 2.5% = idr 402.5 billion (indomaret, alfamart, alfamidi) table 9. after hearing an explanation of the potential lost zakat of 402.5 billion rupiah per year only by shopping at three national retail outlets, what kind of shopping model will be used by the informants. no. the shopping model after knowing the potential for zakat lost 402.5 billion rupiah per year male resource person female resource person sub total and % amount % amount % south asian review of business and administrative studies vol. 3, no. 2, dec 2021 85 1 keep shopping as usual 15 30 23 46 38 2 increase shopping at the neighbor's shop 32 64 27 54 59 3 no more shopping at retail 3 6 0 0 3 total 50 100 50 100 100 source: research data after processing, 2021. the results of the research above show that by making one move through socializing the potential for commercial zakat income if shopping at a neighboring shop, the results show that 38% of respondents will continue to shop as usual. the 38% of these informants can be divided into three parts, namely: 1) continue to shop as usual, where you spend more often at national retailers, and are not affected by the socialization of the potential loss of zakat; 2) keep shopping as usual, because it is more dominant to shop at neighboring stalls/stores; 3) keep shopping as usual, because purchases at national retail are products that are not available at neighboring stalls/stores but are available at national retailers. the results of the study also showed that 59% of respondents stated that they would further increase their shopping intensity at neighboring stalls, and there were even 3% of respondents who stated that they would no longer shop at national retailers. seeing the results above, a shopping movement at neighboring stalls is very much needed that is solid and active. it is recommended that the institution should be formally formed so that the organization is based on law so that it is protected by law. then embracing msme actors so that their organization becomes bigger and more solid, where msme actors are also used as organizations whose one function is to drive the shopping movement at neighboring stalls in their respective coverage areas. then the collaboration of shopping movement organizations in neighboring stalls and msmes, periodically and intensively socializing the goals and benefits of the shopping movement at neighboring stalls. a very effective medium is msmes themselves where every time and space msmes must have a quote, let's go shopping at a neighboring shop. for example, on signboards, business rooms, consumer desks, social media, msme youtube channels must include a quote, let's go shopping at a neighboring shop. then added by the movement organizations must also use social media, advertising on the internet, youtube channels to include quotes, let's go shopping at a neighboring shop. this effort is believed to have a very effective impact on the development of msme businesses which are actually indonesian indigenous people. this repeated socialization activity will certainly have a positive impact if you look at the opinion of jozef goebbels, minister of propaganda in nazi germany, who said that a lie that is repeated will become the truth. so that the socialization of the movement in a solid and intensive manner, god willing, will bring people's awareness to buy products that are sold and produced by neighbors (children of the nation). this movement must be rooted in the general public, but must also be rooted, branched, and branched to the top level, namely to the executive, legislature, and judiciary. this is due to the interests of several parties whose business will be disrupted, which will certainly react to this movement. that's why this movement must be well organized, because in accordance with the statement of friends of ali bin abu talib ra stated that organized crime can defeat disorganized truth. so if it is well organized, it will make the indonesian people able to host in their own country. conclusion based on the results and discussion of eating, several conclusions can be drawn including: the main sources of information about zakat are from mosques 33.3%, friends 15.7%, social media/internet 14.3%. 60% understanding of commercial zakat (knowing and very knowledgeable), 23% understanding a little, and 17% not understanding. this result is south asian review of business and administrative studies vol. 3, no. 2, dec 2021 86 corroborated by knowledge of the zakat recipient groups where 23% mention 4 to 8 groups, 71% mention 1 to 3 groups, 6% who do not mention the recipient groups. the shopping movement at a neighboring shop was known by 67% of respondents, and 33% of respondents who did not know. benefits of shopping at neighboring stalls: 1) increasing microeconomy 33%; 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(2020). “bangkitkan ekonomi di tengah new normal melalui gerakan belanja di warung tetangga” https://kaltimtoday.co/bangkitkan-ekonomi-di-tengah-new-normalmelalui-gerakan-belanja-di-warung-tetangga/ south asian review of business and administrative studies vol. 3, no. 2, dec 2021 88 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 107 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.2, december 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas waqf conceptual model: a practical implementation for a private specialist hospital shaharom md shariff, an-nur specialist hospital, malaysia siti mashitoh mahamood, university malaya, malaysia article details abstract history revised format: nov 2021 available online: dec 2021 keywords social insecurity, healthcare expenses, waqf conceptual model, state islamic religious council (main) the aim of this paper is to propose a viable conceptual structure for waqf model in a private specialist hospital setting which has yet to be implemented through cooperation between waqf corporation of the state islamic religious council (main) and an-nur specialist hospital (ansh). there is certainly an urgent need to harness this collaboration since the society is afflicted by all sorts of economic and social insecurity and also due to the relatively high rising healthcare expenses incurred especially in private specialist hospital. this preliminary study is based on academic literature and also institutional data documentation methods. ever since ansh moved to its new premise at section 15, bandar baru bangi from june 2019, the empirical data of its expenses and billing can currently be formed as a basis for this study. this collaboration between a main institution and ansh opens up a new dimension in the waqf structure in malaysia, especially the model for a private specialist hospital. the findings are expected to further boost the involvement of main with other private specialist hospitals in waqf activities. the outcome of the study can assist in improving the socio economy of muslims and non-muslims especially in the aspects of healthcare. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: shaharomshariff@gmail.com doi: https://doi.org/10.52461/sabas.v3i2.739 introduction in the glorious era of the ottoman empire, waqf institutions had a tremendous role in funding the construction of public facilities for the benefit of the community . various public facilities such as roads, bridges, schools and hospitals were funded by waqf funds without involving allocation from the government. the funds also provide employment opportunities to young people and help improve socio-economic of muslims. the fall of the ottoman turkish government had weakened waqf institutions to continue to act as agents of national development. however, over the past three decades until now has witnessed muslims in several countries such as turkey, pakistan, kuwait and malaysia strive to restore the great role played by the waqf institutions. the government and also the private bodies in the countries concerned have been directly involved in managing and administering existing waqf assets and developing new waqf programs. https://journals.iub.edu.pk/index.php/sabas mailto:shaharomshariff@gmail.com https://doi.org/10.52461/sabas.v3i2.739 south asian review of business and administrative studies vol. 3, no. 2, dec 2021 108 the concept of cash waqf is the current phenomenon which is becoming increasingly popular since it forms the easiest medium for muslims to perform waqf activities. this current cash waqf method is another way for muslim to contribute besides other waqf means involving land and buildings . the current state of waqf activities has made it more easier for corporate entities to be involved in aspects of management and development of waqf properties. there is a trend for corporate companies to be involved in asset management and development of waqf as part of the companies’ corporate social responsibility, csr. this is also known as corporate waqf which indirectly signifies commendable ethical way of how corporate world is perceived as not just focused on activities of sheer profit but also contribute back to the community activities. most companies which engaged in the waqf programs are involved in education, health and property management. these activities enhanced further the corporate entity in discharging their csr. the incorporation of corporate elements in the management and administration of assets in its governance, accountability and transparency are very important aspects to be given strong attention by these waqf institutions especially to establish public confidence to contribute to waqf institutions. it is more pertinent when handling cash waqf which requires deep experience and expertise to ensure the efficient and sustainability of such programs . as for this study, it will be focussing on the conceptual model of how ansh can provide waqf activities in collaboration with the role played by main which is responsible in establishing and incorporate the waqf institutions. for the moment it is limited to ansh since the empirical data is based on ansh. this collaboration between main and ansh may foster public confidence in contributing the positive aspects of the corporate world in waqf management which in turn will add communities’ confidence in waqf institutions besides indirectly increasing waqf funds for the benefits of the ummah. problem statement healthcare expenses have seen an annual increase of about 15% . the increase has created a gap for more ways of providing alternative in subsidizing these expenses. whilst the public hospital received tremendous pressure to clear backlog list of patients waiting for their turns, the private sectors are still free to render services to patients. however due to the high expenses, not many can afford to pay the private hospital fees unless they have insurance or takaful coverage or their companies underwrite their fees. the initiative undertaken by ansh and collaboration with waqf institution is a step towards pioneering cooperation between private healthcare providers and islamic financial institutions that will eventually help to subsidise partially the healthcare expenses. this will allow many patients to be able to afford a private hospital treatment which in normal circumstances not affordable to them. objectives among the primary objectives of this study are: 1. to analyse the governance structure of the conceptual model. 2. to propose the subsidies model between waqf institution and healthcare provider. 3. to propose the appropriate percentage of benefits gained from the fees of the corpus for the participating agencies. scope and limitation the study is confined on ansh data since the modelling is based on data collected after more than two years of operation. the modeling works well based on the empirical data collected over more south asian review of business and administrative studies vol. 3, no. 2, dec 2021 109 than two years as a tertiary specialist hospital. the data collected on the invoices of suppliers, the percentage of cash patients versus panel patients and also data includes the cost of maintenance of the medical equipment and the rental of the building. these empirical works had been done by institutional data documentation method within the ansh itself and thus, it is very meaningful as one of the authors of this article is the ceo of the institution. the data was collected from chief financial officer of ansh in early 2021. literature review there is still minimum literature on waqf for healthcare services especially private specialist hospital. a study earlier by norizah (2015), on waqf an nur hospital initiated by kpj corp has gone through a major success with the formation of waqf annur corporation berhad, wancorp. however wancorp has diversified more than just healthcare into other sectors example charitable programs for mosque, education and other flood relief programs. hence it is no more limited to just healthcare. this section will discuss the literature highlights related to waqf from islamic law perspective and the current development of the malaysian waqf institutions as well as developments of corporate waqf practically. waqf concept from the view point of language, waqf is viewed as means to withhold or refrain. waqf definition according to islamic law is a form of giving a gift where the physical of the asset remains while the benefits derived from the asset are channeled to the recipient subject to the conditions set by the waqf. physical retention of waqf assets means that any property that has been endowed will not be sold, inherited, gifted, or any other way for ownership. the distribution of the benefits of waqf properties refers to the provision of revenue generated from the assets involved to the recipient as determined by the waqf without expecting financial remuneration. thus, technically waqf can be interpreted as a form of surrender the property that may be used for a particular purpose with the condition of the asset must be permanent and non-transferable as well as benefits or revenue obtained from the assets involved are channeled to charitable activities in obtaining the pleasure of allah. waqf is usually associated with immovable properties like land and buildings since it provides perpetuity and applies to non-perishable types of properties whose benefits may be taken without the property being consumed. books, agricultural machinery, cattle, shares, stocks, and cash money, on the other hand, are all waqf. although the concept of waqf is as ancient as mankind, muslim jurists say that the first waqf ever existed at the sacred edifice of ka'abah in makkah, which is referenced in the quran as the first place of worship for allah. “lo! the first sanctuary appointed for mankind was that at baitullah, a blessed place, a guidance to the peoples”. ( surah al-imran ayat 96) there are three types of waqfs, according to habibollah (2010) : waqf for mosques and religious schools is referred to as religious waqf. 2. humanitarian waqf: profits are distributed to serve society and encourage social activities under humanitarian waqf. the library, educational facilities, and hospital, for example, are all examples. waqf from the parents to their children and heirs is referred to as family waqf. alias (2012) also added a sort of waqf known as cash waqf, which is described as a waqf established by a founder with the goal of having the corpus or principle maintained by a trustee in order to create an income that may be used for the creator's specified charitable objectives. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 110 waqf institutions in malaysia as stated in item 1 of the ninth schedule, list 2, state list of the federal constitution of malaysia, all matters pertaining to waqf property are administered under the jurisdiction of the state islamic religious council (main). main, as the sole trustee of waqf assets, has the ability to select any individual or organisation as its representative for the purposes of administering waqf assets and developing waqf assets to generate rental and dividend income. melaka, negeri sembilan, selangor, perak, terengganu, and sabah have specific waqf enactments: wakaf (state of malacca) enactment 2005, wakaf (state of negeri sembilan) enactment 2005, wakaf (state of selangor) enactment 2015, wakaf (perak) enactment 2015, wakaf (terengganu) enactment 2016 and wakaf (state of sabah) enactment 2018. these laws outline the legal features of waqf as well as the rights and responsibilities that the state islamic religious council have when it comes to managing waqf assets. in recent years, there has been a lot of positive change in malaysia's waqf administration and development. the federal government has led the way in establishing institutions at the federal level and allocating funds to develop abandoned properties around the country in order to enhance and streamline the waqf administration apparatus. the modern notion of cash waqf, which is widely popular and adopted in various countries, has prompted parties authorised by waqf to develop cash waqf programmes that allow people and waqf organisations to contribute at a very low cost. involvement of business companies in waqf matters, often known as corporate waqf, is a new step to increase public's interest in philanthropic operations like waqf. due to the increase interest in waqf activities, issues of governance, integrity and practices relating to waqf property need to be analysed. the paper by masruki & shafii (2013) concludes that accounting could improve the best practice in waqf institutions. it is an ideal mean to discharge the accountability of trustee (mutawalli). however, the absence of accounting standards for waqf is the main reason for dissimilarities of waqf accounting practice. an islamic dual accountability is the most suitable element to elaborate the concept of islamic accountability in waqf institutions. for that reason, the mutawalli should discharge accountability to various stakeholders like giver (waqif), waqf board and beneficiaries. this will create greater confidence for waqif to be more benevolent to contribute to waqf institution. healthcare services in malaysia government public hospitals, privately owned hospitals, and non-profit private hospitals are the three categories of ownership that characterise hospitals in malaysia. government-funded public hospitals and charitable non-profit private hospitals have both existed for many years. many private hospitals have sprung up in most emerging nations as a result of the advent of privatisation in healthcare services. governments have built and funded public hospitals to provide virtually all types of treatment for free or at subsidised rates, in keeping with the concept and spirit of public facilities development. since most of these private hospitals have increasingly started to operate for higher profits, the philanthropic segment of private hospitals has been small in monetary terms. this is due to the fierce competition in the healthcare business. attractive remuneration packages are offered to the healthcare staff in order to retain doctors, nurses, and technologists. the health system in malaysia is facing increasingly challenging issues which can affect its performance and sustainability. private sector services also serve as a challenge to the public sector because of its capabilities attracting professionals to leave the public sector. this has caused a shortage of professional manpower and increasing workload amongst healthcare practitioners as well as congestion due to high number of patients in the public health sector. south asian review of business and administrative studies vol. 3, no. 2, dec 2021 111 health-care costs have risen dramatically over the years. increased services due to changes in disease patterns, demographic patterns of the population, and increased health awareness among the population are among the contributing factors to this cost increase. patients had to pay a high price for limited health services if there was no solution to the rising health-care costs. waqf is a method of alleviating societal burdens by establishing a health-care system based on people's contributions. waqf is a special type of charity according to islamic teachings because it is a form of worship that includes spiritual elements. waqf instruments play a significant role in the community's provision of services such as education, health, municipalities, and charitable programmes from a socioeconomic perspective. there appears to be a general lack of urgency among healthcare workers to complete their clinical procedures, while bureaucracy appears to be causing bottlenecks in public hospital administration. patients had to wait weeks or months for an appointment with a specialist, and surgery cancellations were common. while private-sector services and care are excellent, the same cannot be said for public-sector hospitals. because most hospitals are overcrowded, finding a bed in one of them can be difficult. healthcare providers in public hospitals are not held to a high standard of accountability, and the majority of services are provided by junior doctors or doctors in training. patients are frequently at the mercy of healthcare providers, and the majority of malaysians prefer to receive their treatment in a private practise. unfortunately, paying out of pocket for private healthcare in malaysia is prohibitively expensive for locals. because all private healthcare is for profit, medical services and surgeries are extremely expensive. as a result, access to private healthcare is limited to the wealthy or those with private health insurance. takaful and insurance policy for healthcare malaysia's health-care financing system is a mix of public and private. private health insurance is optional in the private sector, with variable premiums based on the individual's health status, type of insurance, and level of coverage. employers in the private sector can choose to provide welfare and health benefits to their employees, and they usually negotiate packages with managed care organizations (mcos) and private insurance companies to provide medical insurance coverage. the ministry of finance allocates annual health budgets to the ministry of health, which fund public health care services through general taxation. the national budget allocates a percentage of general revenue to ministry of health functions each year. additionally, the formally employed workforce contributes monthly to an employee provident fund (epf), a mandatory savings scheme that provides a measure of retirement security and disburses supplementary benefits to members for medical expenses as well as capital purchases such as the family home. all private sector formal workers earning less than rm 3,000 per month are required to pay a minimum contribution to the social security organization (socso), a scheme that provides medical benefits for members injured at work. socso and epf payments, on the other hand, do not account for a significant portion of healthcare spending due to the small contribution and coverage provided. employees and their families in the public sector have free access to public medical services, and some have private insurance or medical care benefits. a muslim believes that any disaster that befalls him, his family, or society is fated and is referred to as qada' and qadar from allah, according to islamic perspectives on insurers who purchase insurance/takaful policies (the almighty). the prophet (pbuh) always emphasised the importance of remaining patient in the face of adversity and remaining resilient, both spiritually and physically, through faith. muslims, on the other hand, have always been taught to avoid or minimise the likelihood of such events if at all possible, as well as to be financially prepared. as the well-known hadith points out, south asian review of business and administrative studies vol. 3, no. 2, dec 2021 112 ‘‘the prophet (pbuh) told a bedouine arab who left his camel untied to the will of allah: tie the camel and then leave it to allah’s will’’ (as reported by both al-tarmidzi and ibn majah) as a result, insurance, also known as takaful, is a noble activity in which members of society pool their resources to compensate one another after a loss. this, in turn, provides financial assistance in the event of an unforeseen future loss, thereby contributing to poverty reduction, mutual cooperation, and the spread of the brotherhood spirit. modern economies rely heavily on the uniqueness of insurance/takaful products. the cost of medical care is covered by medical or health insurance/takaful. waqf hospitals in the glorious days of islam during the glorious days of islam, there were many hospitals supported by waqf. ibn tulun hospital, located near the mosque in cairo, egypt, is one of them. furthermore, badr ghulam hospital in baghdad, baghkami hospital in turkey, ikshidid hospital in egypt, a hospital built by muizzuddawala ibn buwayh in baghdad, marakish hospital in north africa, adudi hospital in baghdad, nuri hospital founded by raja nur al-din zanji, and mansuri hospital founded by almansur ibn qulawun in cairo are among the first hospitals built (1276 ad). in the golden age of islam, hospitals had their own waqf properties to support the doctors on duty. this section of the waqf is overseen by a nazir, who is typically worn by heads of state or caliphs. the concept of corporate waqf for private hospital waqf assets in the form of movable property, such as cash, company shares, and dividends, are managed entirely by corporate entities or in collaboration between corporate companies and waqf authorities under the corporate waqf umbrella. waqf assets are one of the most important aspects of the corporate waqf structure, while waqf trustees, or corporate companies, are both mutawallis and waqf property recipients. the johor corporation (jcorp) was the first to use the term corporate waqf when it established one in 2006 by endowing rm200 million in shares in its subsidiaries kulim (m) berhad, kpj healthcare berhad, and johor land berhad. waqaf an-nur corporation (wancorp), a jcorp subsidiary, has been entrusted with managing corporate waqf that focuses on health through the waqaf an-nur clinic network and waqaf an-nur hospital. patients seeking treatment at the clinic and hospital are charged a minimum of five ringgit, with muslims and others among the patients. waqf property management has been undertaken by corporate companies in a number of countries, particularly in the education and health sectors. in september 2012, bank muamalat malaysia berhad (bmmb) collaborated with perbadanan wakaf selangor (pws) to launch waqf selangor muamalat, the first cash waqf scheme in malaysia. bmmb and pws are now joint managers of waqf assets acquired through the purchase of cash waqf certificates at any bmmb branch. waqf contributions can also be made via internet banking, monthly deductions, or periodic payment instructions. it's also worth noting that corporate involvement in management and waqf administration can help improve society's perception of waqf institutions. within the management of waqf assets, the image has been deemed to have ineffective governance. the sole trustee of waqf property in the states, the state islamic religious council (main), was found to be lacking in trained and experienced staff to manage large amounts of waqf assets waqaf an-nur corporation berhad, wancorp in 2006, johor corporation berhad (jcorp) introduced the concept of "corporate waqf," involving the transfer of 12.35 million unit shares in jcorp kulim (m) bhd, 18.60 million unit shares in kpj south asian review of business and administrative studies vol. 3, no. 2, dec 2021 113 healthcare bhd, and 4.32 million unit shares in johor land bhd to waqaf an-nur corporation bhd as trustee. this concept is a key institutional strategy for achieving the company's "business jihad" corporate mission. as evidence, jcorp pledged to devote 25% of its annual dividend payout from shares transferred into waqf as part of its corporate waqf agenda, which was announced in 2007. as a result, the dividend can be used to organise various activities for muslims and nonmuslims, as well as charitable and religious activities that benefit and meet the needs of the entire society. waqaf an-nur hospital was established as the first waqf hospital in johor, with the goal of completing health development efforts. johor corporation berhad (jcorp) through kpj healthcare berhad, in collaboration with the johor islamic religious council, established waqaf an-nur hospital as a charitable and non-profit hospital (maij). waqaf annur hospital focuses on providing health care to underserved members of the community. in1999, a firm called jcorp created a waqf clinic in pasir gudang, which preceded the development of the waqf an-nur hospital. because of the increased demand from the people of pasir gudang, the clinic was elevated to a hospital in2006, and it later became the country's first waqf hospital. his majesty sultan iskandar ibn al-marhum sultan ismail laid the foundation stone for the hospital on april 21, 2006. from year to year, the total number of patients treated in hospitals by this waqf has risen. in2012, a total of 43,624 patients were treated at hwan, compared to 35,665 patients in 2008. the rm 225,050 spent on healthcare services was reported in the wancorp annual report 2020. the objective of waqf an-nur hospital is to give and provide medical facilities to the community especially the low-income regardless of race and religion. ideas for establishing wanh was born out of efforts to expand healthcare services and treatment project by jcorp. the mission of this waqf hospital is to provide medical care to all patient regardless race and religion at a minimal rate especially to the class underprivileged society. meanwhile, the vision of this hospital is to ensure the community especially the income group low around pasir gudang can enjoy medical services which is perfectly on par with other government or private clinics. an-nur specialist hospital an-nur specialist hospital (ansh) was established in september2005, originally as an outpatient department, and subsequently as a secondary hospital in february2006, offering health care services to the bandar baru bangi population. the institution was first housed in a shoplot building in medan pusat bandar1, section 9. there were 30 beds at the hospital. on june10, 2019, the hospital moved to a newly constructed building in section 15 with 104 beds. the hospital serves the fast-growing city of bandar baru bangi as well as nearby areas such as putrajaya, nilai, serdang, kajang, bandar bukit mahkota, bandar seri putra, and south ville with affordable, highquality healthcare. in may2015, ansh became the first private hospital to receive ms1900:2014, with the accolade naming ansh as the first private shari'ah-compliant hospital, sch. islamic terms such as shariah advisory council, shariah compliance, fiqh, shariah compliance unit, halal, quran, hadith, sunnah, al-ijma, and fatwa are written in standard in ms 1900. this shari'ah-compliant certification will have an impact on the health management system and the overall operation of hospital services in the hospital setting. as a result, incorporating islamic values into the service process necessitates an all-encompassing approach. since its move to the new premise ansh has started its charitable program known as dana rahmah . it provides subsidized fees for unaffordable patients to enjoy private hospital healthcare services at much lower bill charges. since january 2021 till to august 2021, dana rahmah has south asian review of business and administrative studies vol. 3, no. 2, dec 2021 114 spent more than rm 107,224.04 to about 23 patients. the fund has been contributed by consultants and also staff of ansh. ansh has applied to transfer into a registered non-profit organization, company limited by guarantee, clbg named medik nur rahmah berhad, mnrb so as to spread the fund to other public for contribution. this move is towards forming collaboration with main to authorize mnrb as waqf mutawalli (waqf manager) and also recipient of waqf for healthcare patients. analysis of the proposal this concept will be the second corporate waqf in malaysia for healthcare services which involves cooperation between a state government-owned waqf institution (main) and a private specialist hospital, an-nur specialist hospital, bandar baru bangi (ansh). the cooperation established between the two institutions involved indeed with different backgrounds in developing waqf assets through corporate waqf strategies is very interesting to study. further discussion will revolve around the analysis of the proposal which consists of three main aspects namely governance structure, financial structure, implication and funds allocation to various agencies from the benefits of the corpus. the proposal will allow ansh to receive any waqf items either cash or material from any donors who wish to contribute to the nominated waqf agency which according to the state enactment not possible unless main has permitted. collaboration structure between various agencies state islamic religious affair (main) and ansh will have a collaboration agreement to facilitate the operation of the waqf program. in the initial stage a joint committee will be set up to manage operation of waqf through the establishment of company limited by guarantee, clbg or direct management by the main agency. figure 1 shows the various agencies proposed that involved in the collaboration framework. the various agencies’ functions are explained in the next paragraph to clarify each scope of work. the scope of work of each agency has to be fully understood to ensure a proper accountability in order to gain public confidence. waqf corporation, wc waqf corporation is responsible to manage the fund collected from the public through various channels available ie banks or waqf office set up by states religious council. the main function will be to ensure efficient disbursement of the fund collected from public. since its function covers other sectors example education and place of worship surau or mosques. the maintenance of the south asian review of business and administrative studies vol. 3, no. 2, dec 2021 115 healthcare facilities is very much more efficient to be taken care by another focused entity through setting up a company limited by guarantee, clbg. establishment of clbg wc is responsible for channeling all related waqf funds for healthcare collected from public and also through the model arrangement with the healthcare provider. this is to carry out the waqf projects, helping waqf beneficiaries especially in healthcare, and investing part of the waqf proceeds for future usage. the main function of clbg is the management of fund in term of disbursement to eligible beneficiaries. clbg will also carry out the maintenance of building and medical equipment of the hospital owned by wc. through proper maintenance of the building and equipment, the healthcare provider is able to provide efficient and high productivity services to the patients. medik nur rahmah berhad has been established to undertake the role of the clbg. financial and operational structure from figure 2 explains the financial structure and operations of wc and the hospital operator based on the scope of works. waqf corporation, wc waqf funds are obtained through the contributions of individuals as well as institutions that can deposit cash as waqf asset. the minimum contribution for individuals is as low as rm10 while for institutions is as low as rm100 and no limit is set. in term of fund management, wc will have a target to raise rm50 million within two years as an example. the initiative will start with waqf contribution from wc and the waqf fund collected will be channeled to clbg. the funds are used to purchase medical assets example medical equipments for the hospital. the waqf assets will be considered in the patients bill for patients to enjoy the discounts related to those assets. hospital operator the hospital operator will run as a normal private hospital except the cash patients will enjoy direct discount of the fees charges. for normal panel or insured /takaful patient, the fees will be as normal but the saving obtained because of the waqf portion will be contributed back to clbg. hospital operator wakaf corporation agency building medical equipment doctors nurses & staff medicines & disposables figure 2 show the scopes of work between wakaf agency and hospital operator south asian review of business and administrative studies vol. 3, no. 2, dec 2021 116 from the empirical data collected for two years the 60 % of the patients are panel whilst 40% are cash patients. from the table 1 and table 2, it can be clearly seen that on average from the two sample bills, there is a discount of about 23% when waqf facilities were disbursed. there can be two options based on 1. building and medical equipment capital cost 2. bed occupancy rate and equipment cost. in this sample bill for cataract procedure, the normal bill is rm 4,999 whilst the discounted rate with the waqf facilities will only cost rm 3,744 with a discount of 25%. in the table 2, the discount is about 22%. hence this rate can be used as a guide for the discount rate. table 1: cost saving for cataract procedure ( source : courtesy an-nur specialist hospital ) items fees wi/out wakaf (rm) items fees with wakaf items ( rm ) consultant fee 1,960 consultant fee 1,960 device : lens 600 device : lens 600 hospital equipment expense 755 wakaf ain ; equipment 0 operating theatre usage 500 wakaf ain: building 0 nursing procedure fees 1,184 nursing procedure fees 1,184 4,999 3,744 a saving of rm 1.255 to patient or 25 % items fees wi/out wakaf ((rm ) items fees with wakaf ( rm ) consultant fees 4,980 consultant fees 4,980 icu ward 2,345 wakaf ain : building 0 lab test 2,186 lab test 2,186 hospital equipmt 900 wakaf ain: equipmt 0 cath lab 2,000 wakaf ain :equipmnt 0 medical device 10,000 medical device 10,000 medication and disposable 3,134 medication and disposable 3,134 nursing procedure 3,095 nursing procedure 3,095 radiology services 3,669 radiology services 1,669 32,309 25,064 a saving of rm 7,245 or 22% table 2: cost saving on angioplasty procedure ( source: courtesy of an-nur specialist hospital ) south asian review of business and administrative studies vol. 3, no. 2, dec 2021 117 the system offered two options. option 1 is based on revenue per month with a discount of 20% when the building, equipment and hospital infrastructure cost contributed by waqf. option 1 is a fully funded hospital where all the assets are waqf based. hence 20% discount is based on the revenue generated from the bills. in this case, patients who pay through cash basis will enjoy the 20% discount whilst for panel patients, there will be no discount to the payer. however, the discounted amounts contributed due to waqf assets, supposedly awarded to payer will be transferred to the clbg. a total of rm 14.4 million will be collected and then it will be distributed to various parties as shown in figure 4. in the case option 2, it is based on bed and medical equipment which is much less than option 1. from figure 3, option 2 provides bed and equipment rental with a total of about rm 2 million. with 20% discount of rm 2 million per month, rm 500,000 per month will be collected for waqf. here a total of rm 3.6 million is collected yearly and distributed with similar rate as option 1. although the distribution of discounted amount is viewed as much less, however the direct benefits are enjoyed by those who paid on cash basis about rm 2.4 million annually in option 2 whilst option 1 the direct benefits on cash basis is rm 9.6 million annually. benefits from the waqf activities for the ummah the high healthcare expenses at private specialist hospital had compelled many patients to seek medical treatments at public hospitals. however due to covid patients are being treated at most public hospital especially in klang valleys, many had avoided their normal treatment at public figure 4 :monthly return from panel discount for option 1: building & equipment and distribution of fund to various agencies ( source: courtesy of an-nur specialist hospital ) rm 2mil (rm 24 mil per year) 60% panel rm1.2mil ( rm 14.4 mil per year) 40% cash rm800k ( rm 9.6 mil per year) 10% majlis agama islam/pws (rm 1.44 mil) 15% mangement of clbg (rm 2.16 mil) 15% hospital operator (rm 2.16 mil) 60% clbg maintenance (rm 8.64 mil) *pws : perbadan wakaf selangor figure 5 :monthly return from panel discount for option 2: bed & medical equipment and distribution of fund to various agencies ( source: courtesy of an-nur specialist hospital ) rm 0.5 mil (rm 6.0 mil per year) 60% panel rm 0.3mil ( rm 3.6mil per year) 40% cash rm0.2 mil ( rm 2.4 mil per year) 10% majlis agama islam / pws (rm 0.36 mil) 15% management of clbg (rm 0.54 mil) 15% hospital operator (rm 0.54 mil) 60% clbg maintenance (rm 2.16 mil) *pws : perbadan wakaf selangor south asian review of business and administrative studies vol. 3, no. 2, dec 2021 118 hospital. to seek treatment at private hospital may be unaffordable for many patients. hopefully with the added waqf facilities, it will provide patients a broader accessible range for them to seek medical treatment at private hospital since the 20% discount for cash patients is quite substantial. for those who are encouraged to do righteous deeds, as mentioned in quran surah an-nahl ayat 97 “ whosoever does righteous deeds, whether male or female, and is a believer, verily we shall quicken with good life and we shall pay them a recompense in proportion to the best of what they used to do” the waqf program provides a platform for those who want to contribute towards the virtuous deeds and receive the reward in perpetuity. many would continue to contribute when they are enlighten with the progress of such program for the benefits of the ummah. the initial step towards this philanthropic waqf is very much depends on the trust earned when the programs are fully transparent. at the moment ansh has received hospital beds, wheel chairs and a complete haemodialysis machine as waqf asset to ansh patients. discussion the proposed model will only work when main allows to the formation of the framework. the wancorp success was the collaboration between maij and jcorp and heavily supported by kpj healthcare for the health services. similar set up can be established if main selangor approves such collaboration. although the accumulated assets of wancorp has reached more than rm 811 million, however the benefits for healthcare allocated in 2020 was rm 225,050. wancorp has diversified into other charitable programs and the success had benefitted the ummah as a whole especially in johore state . however other states need to replicate the success. the move by ansh is a step towards improving the philanthropic programs in healthcare. the proposed two options very much depended on the available waqf fund contributed by public or any philanthropic institutions. option 1 exhibits the full complete waqf programs for all tangible assets in the hospital. if that is true then rm 24 million can be available to clbg and the benefits for healthcare services will be appreciated by public in klang valley. in case of option2, only about rm 6 million will be allocated for waqf benefits. as compared to wancorp, the allocated benefits in healthcare services provided by these options are much more. hence it is most pragmatic initiatives to pursue this collaboration for the benefits of the ummah. conclusion the role of waqf is in providing health care services to the local community by giving low fees or at discount rate as proposed at an-nur specialist hospital. this can be as an alternative to society to reduce the long waiting time at public hospitals. the time for the institution of waqf to support healthcare service is apt since the pandemic has afflicted many in the community with reduced economic capabilities and social security. however, the main effort is to obtain the approval from state religious council to allow public contributions in the form of cash waqf or in the form of tangible assets, example hospital beds or wheel chairs which are popular contribution by public to hospital. as an effort to enhance the momentum of waqf activities in healthcare, it would be an advantage to look into the collaboration between a private healthcare provider and main. although there are still areas of alignment and streamlining of scope of works in the healthcare industry, building public confidence and trust is paramount to ensure the success of this program. this collaboration will enter a new dimension in philanthropic waqf for healthcare services south asian review of business and administrative studies vol. 3, no. 2, dec 2021 119 references abd. shakor, b. 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(2020). annual report 2020. in annual report 2020. http://wancorp.com.my/content/files/documentlist/wancorp_documentlist_fada574 e.pdf south asian review of business and administrative studies vol. 4, no. 2, dec 2022 165 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas a new view on the socio-economic factor in child mortality asymmetric ardl provides new evidence for developing country sdg (sdg's) achievement dr. muhammad waqas, assistant director, punjab higher education commission, pakistan nimra razzaq, the superior university, lahore, pakistan mahwish zafar, the superior university , lahore, pakistan article details abstract history revised format: nov 2022 available online: dec 2022 keywords climate change, education, water sanitation, environmental health, child mortality, developing countries and sustainability purpose – the purpose of this study is to explain the link between child mortality and education, environmental health, water sanitation, and climate change. it seeks to manage and reduce child mortality by detailing why and how education, climate change, and environmental factors are crucial in lowering child mortality during a five-year period. the study intends to broaden the realm of child mortality reduction by integrating a water sanitation and health component not commonly identified in the literature. design/methodology/approach – the paper for an exploratory research between 1996 and 2020 utilising the asymmetric auto regressive distributed model (ardl). long-run co-integration results suggest that auto regressive distributive lag (ardl) is appropriate for examining the short-run connection between the modelled variables. the information comes from the world development indicator (wdi), which covers seven developing countries: pakistan, iran, indonesia, afghanistan, india, bangladesh, and nepal. findings – according to the study, access to improved water and sanitation facilities, environmental health, and climate change all have a substantial and negative impact on child survival. furthermore, the study looked at the impact of schooling on child mortality. research limitations/implications – the chosen research technique may limit the generalizability of the study findings. as a result, researchers are encouraged to examine the presented hypotheses further. practical implications – this report advises policymakers and international organisations that in order to fulfil the needed rate of child mortality, households should have access to clean water and sanitation services. furthermore, the report suggests that the government adjust environmental and educational policies in order to reduce child mortality. https://journals.iub.edu.pk/index.php/sabas south asian review of business and administrative studies vol. 4, no. 2, dec 2022 166 originality/value – the major objectives of the study are to construct a extrapolative exemplary for under-5 mortality and to categorize important hazard variables connected with under-5 deaths using nationwide demonstrative facts on kids under-5. © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: waqas_epouch@yahoo.com doi: https://doi.org/10.52461/sabas.v4i2.1540 introduction the health and development of a child, as well as the general development of the country, are strongly correlated with toddler mortality. a nation's economic, environmental, and quality of life conditions are all largely determined by child mortality, especially for families with young children. finding potential risk factors for child mortality in children under five was the study's main objective. it serves as a reliable gauge of how well the sustainable development goals are being achieved. the major objectives of the study are to construct an extrapolative exemplary for under-5 mortality and to categorize important hazard variables connected with under-5 deaths using nationwide demonstrative facts on kids’ under-5. although infant death among kids’ under-5 has decreased significantly worldwide, it remains a critical civic fitness issue in unindustrialized nations, where rates have remained higher than in other countries from 1996 to 2020. the international underfive-year-old toddler death rate in 2016 was 42 deaths per 1000 live births, down from 94 deaths per 1000 live births in 1990. this equates to a 56% decrease in global infant death rates under-5. the goal of sustainable development goal (sdg) 3 is to diminish kid death under-5 to at least 25 per 1000 live births by 2030. child mortality among children under the age of five has dropped dramatically worldwide, from 217 deaths per 1000 live births in 1951 to 388 deaths per 1000 live births in 2018. allowing to projections since the global burden of disease (gbd) 2018 sdg collaborators, countless nations are on pathway to meet the mark of slightest 26 fatalities per 1000 alive labors by 2030. every year, approximately 7 million toddlers under the age of five die around the world, with poor countries bearing a disproportionately high burden of child mortality. despite the fact that seven developing countries have been working to reduce infant mortality rates since 1990, they are still falling short of their goal. globally, child mortality fell from 9.6 million to 7.6 million between 2000 and 2010, but the mdg-4 of reducing infant morbidity 1990 and 2015 remains unattainable; clearly, developing countries fall short of the target level of infant survival (echavarri, 2022). (echavarri, 2022). it has been widely reported that 10 million children under-5 are still on the verge of dying each year (sharrow et al., 2022), with the burden of those child deaths increasing in low-income countries, particularly developing countries (lelieveld et al., 2018) the world health organization (who) announced plan 2030 in order to achieve global sustainable development and decided to diminish infant deaths from 172 million to 100 million between 2012 and 2025. developing countries, like other sub-regions, strive to meet mdgs and reduce poverty, but their infant and child mortality rates remain among the highest in the world. furthermore, pakistan has the highest child mortality rate among developing countries. figure 1 can be used to investigate the problem's extremes. in 2021, pakistan (pak) will detect 65.2, while india (ind) will detect 32.6. bangladesh (bgd) comes in third place with 29, iran (irn) comes mailto:waqas_epouch@yahoo.com https://doi.org/10.52461/sabas.v4i2.1546 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 167 in fourth with 13,5, afghanistan (afg) comes in sixth with 58, indonesia (indo) comes in seventh with 23, and nepal (nep) comes in seventh with 28.2 infants’ losses per 1000 alive births. regardless, the worldwide goal is to diminish infant death in developing countries to 13 deaths per 1000 alive births. as a result, this research will continue with the goal of contributing to the global vision of 2030 by identifying significant socioeconomic determinants of child mortality. this research will aid in the representation of intervention measures in developing countries to reduce child mortality rates, thereby accelerating long-term fiscal evolution. these indicators are considered urgent in the literature because they have a direct impact on child health and survival. however, in addition to the variable execute child mortality rate, social and economic factors such as education, climate change, environmental health, and better water facilities that use overdue proximal indicators essential be considered. every day, nearly 30,000 children under the age of five face death in low-income countries due to poverty, a lack of clean water, and inadequate health care (kousar et al., 2019). high child mortality is strongly associated with low economic growth rates in developing countries (roopnarine and yildirim 2019). (2013) (kraft, nguyen, jimenezsoto, & hodge). this study discovered a link between social and economic factors such as education, income, and occupation (cutler et al., 2006) people with less education are more likely to die young (grytten et al., 2020). the following is a discussion of our research findings: child mortality can be reduced through education. one extra year of education results in a 10% reduction in mortality for men aged 16 to 64. in addition to women. furthermore, many developing countries have identified admittance to unrestored water and cleanliness among kids under the age of five as a major public health issue (nakamura, ikeda, et al. 2011). newborns are especially defenseless to health problems connected with insufficient water and sanitation because their on-child mortality in developing countries under the age of five (ezeh et al., 2015). according to research, developed and high-income countries invest more in health infrastructure than developing and low-income countrues (hill et al., 2007). climate change is also a significant contributor to the mortality rate among children under the age of five. effects are classified into two types: direct and indirect. these variables, however, have an impact on child mortality outcome of co2, because greenhouse gas emissions transform the earth's system, resulting in advanced infections, reformed rain, and weather changes. temperature changes (for example, heatwaves and rapidly changing temperatures) are direct consequences of climate change. indirect effects include air pollution and aeroallergens. these possessions can be classified source of straight injury to children, as well as an upsurge in illness risk and the child mortality rate. "the most serious and direct consequence of environmental deterioration in poor countries is damage to human health," (pearce & warford, 1993)"the utmost serious besides direct significance of ecofriendly deterioration in poor countries takings the shape of harm to humanoid well-being," (franz & fitzroy, 2006). as a result, the economic repercussions of poor environmental health have received less attention in underdeveloped countries (franz & fitzroy, 2006). agriculture has resulted in extensive chemical contamination, low water quality and quantity, and a loss in human well-being and economic productivity, particularly in developing countries with greater populations that are increasingly reliant on natural resources. despite this, only a few studies have focused on the implications of lost output and the consequent morbidity (franz & fitzroy, 2006) research questions 1. what effect does schooling have on child mortality? 2. what effect does climate change have on child mortality? 3. what effect does a better water supply have on child mortality? 4. what effect does the environment have on child mortality? 5. what does environmental health affect child mortality? south asian review of business and administrative studies vol. 4, no. 2, dec 2022 168 literature revie infant death among children under-5 is an excellent display of a nation's progress and growth. toddler mortality under the age of five years is estimated to rank fourth among the millennium development goals established in 1990. according to the millennium development goals, all developing countries should strive to reduce child mortality to one per 1000 live births, with under5 set at 30 per 1000 alive births. despite the fact that the entire world had made significant progress since 1990, several poor countries had yet to achieve a sufficiently beneficial outcome in terms of lowering child mortality rates under the age of five. as a result, (bustreo et al., 2015) established sustainable development targets, stating that by 2030, child mortality under the age of five must be reduced to 13 losses per 1000 alive births. there are also a few articles that are relevant in the context of developing countries. child mortality and education the primary goal of the underlying cause theory is to explain why there is still a link between child mortality and education. the educational levels of both the mother and father are the most important factors in reducing child mortality among children under the age of five. education is critical for parents to reduce child mortality in developing countries, according to (jayathilaka et al., 2021) child mortality under the age of five decreases as parents' education improves. it was determined that education was not the only factor influencing child mortality. other factors may contribute to the deaths of children (marshall et al., 2021) households with heads who have only received primary education have a difficult danger of infant death than households with heads who have received secondary education, according to (mamani et al., 2021). in impoverished countries, claim that a father's level of education is also related to child mortality. furthermore, highly educated males have a lower risk of infant death, and the father's educational level has an undesirable impact on child mortality under-5, according to this study. the mother's education is in the middle of the determinant variables; however, the mother's education may be the most important variable because of its direct link with the near factor of mortality. women who are educated may be able to provide improved well-being attention for their kids. they are more inclined to provide enhanced nourishment and hygiene.. through education, women gain access to the outside world, which improves their perspectives and slants (nawaz & anwar, 2021) h1: education has an effect on child mortality. climate change and child mortality infants are especially vulnerable to the negative health effects of rapid heat waves. a heat wave raises the total child mortality rate in a population. (yang et al., 2021) discovered extensive evidence of heat waves are associated with an increased risk of child mortality, however the evidence was greater for babies than for other age groups. further research, particularly underdeveloped countries, indicates an increase in the risk of child mortality from warmness rollers in children, particularly babies. climate change and increased carbon dioxide accumulation affect allergic conjunctivitis by extending and exacerbating the pollen season and influencing allergic conjunctivitis; additionally, warm and moist weather may raise the danger of mould growth indoors, bug and contact allergies, as well as the creation of fungal spores. h2: climate change has an effect on child mortality. water sanitation and child mortality this study expresses the relationship between the sdg index 'under-five mortality rate' and the sdg index 'level of water stress (liu, 2021), with the premise that no identical sdgs (and also different sdg indicators) are inextricably linked (liu, 2021). a clear link between child mortality and water stress is that children's health can suffer as a result of a lack of access to water, leading south asian review of business and administrative studies vol. 4, no. 2, dec 2022 169 to higher child mortality. for example, (liu et al., 2021) use research from ethiopia and nigeria to argue that a lack of water may increase the risk of diseases in children, which is a significant predictor of child mortality. (liu, 2021) discovered that access to clean water is not directly related to children's health, with the hypothesis that installing piped water in households may reduce child mortality. despite the fact that tap water is hazardous to children's health, another study on child mortality had nothing to do with water supply (geere & hunter, 2020) h3: water sanitation has an effect on child mortality environmental health access to clean water and sanitation are the environmental health indicators that are most frequently examined. with over one billion people in developing nations missing access to clean water and two to three billion lacking even the most basic sanitation, access to safe drinking water and improved sanitation is one of the most crucial factors affecting both urban and rural populations' health. (franz & fitzroy, 2006) globally, it is stated that omitted variable bias confuses environmental health variables' capacity to explain variation in mortality resulting from indirect contamination routes, and that they are therefore more frequently utilised in diseasespecific morbidity analyses. (franz and fitzroy 2006). but controlling the health concerns linked to a lack of access to safe drinking water and adequate sanitation is challenging due to disparities between and within nations. (franz & fitzroy, 2006). when other socioeconomic variables are included in a multivariate cross-country study, their explanatory value is limited (filmer & pritchett, 1999) determining the relationship between the two is challenging, particularly in the absence of household-level data, due to the indirect relationship between poor water quality and sanitation and therefore death. h4: environmental health has an effect on child mortality. methodology this information provided secondary data to research the contribution of social and economic variables on child and newborn mortality. this knowledge is based on information from the world development indicators (wdi) for education (government expenditure on education total (% of government expenditure), improved water and sanitation facilities (level of water stress: freshwater withdrawal as a proportion of available freshwater resource), and three environmental quality indicators, including co2 emissions from electricity and heat production, total (% of total fuel combustion), and child mortality rate under the age of five. in developing nations, child mortality is analyzed using seven variables. explain the relationship between education, child mortality, environmental variables, water sanitation, and environmental health. econometric model: cmr = f (co2, edu, health, ws) (1) whereas cmr denotes the child mortality rate for children under the age of five. edu = government education spending as a percentage of total government spending. co2 = co2 emissions from climate change. ws = water sanitation level of water stress health=life expectancy at birth due to environmental health. after converting all of the variables into natural logarithmic form, we obtain the following equations, where each variable's coefficient directly contributes to the elasticity. 𝑙𝑛𝑐𝑚𝑟𝑡 = 𝛼 + 𝛽1𝑙𝑛𝑐𝑜2𝑡 + 𝛽2𝑙𝑛𝑒𝑑𝑢𝑡 + 𝛽3𝑙𝑛ℎ𝑒𝑎𝑙𝑡ℎ𝑡 + 𝛽4𝑙𝑛𝑤𝑠𝑡 + 𝜇𝑡 where α is the intercept, and β1, β2, β3, β4, are coefficients, cmrt is the natural log of per capita child mortality rate, co2t is the natural log of per capita co2, the edit is the natural log of per capita education, health is the natural log of per capita health,wst is the natural log of per capita of water sanitation and u is the gaussian error term. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 170 recent research employs models with enormous durations (t) for analysis in panel data analysis due to the ease of access to data. dynamic panels with a lot of cross sections (n) and long periods (t) exhibit asymptotics. (cheng & bang, 2021) fixed and random effect estimators, or, are used in small periods (t) panel estimation (1991). with these estimators, cross sections are pooled and only the constant term is allowed to change amongst cross sections. it is often incorrect to assume that the slope coefficients are uniform, according to the main findings from the big n and large t. (breitung & pesaran, 2008). numerous estimate strategies are provided by the most current research on dynamic heterogeneous panel valuation with huge n and t. the fixed effect estimate approach pools time series data for each cross section, and intercept terms are permitted to change between cross sections. inconsistent slope coefficients might lead to misleading results from the fixed effect. the model can, however, be constructed individually for each cross-section and the arithmetic means of the calculated coefficients. the mean group (mg) estimator, which is the name of this approach, was first out by pesaran and smith (1995). the intercepts, slope coefficients, and error variances can all differ between cross sections when employing the mg technique. the pooled mean group (pmg) technique, popularised by pesaran et al. (1997, 1999), is used to estimate nonstationary dynamic panels, which becomes increasingly important as the length of the analysis period increases. the pmg estimator employs a mix of averaging and amalgamating coefficients (pesaran et al., 1997, 1999). this estimator, like the mg estimator, allows for cross-group variation in short-run parameters, intercept terms, and error variance. the general form of the pmg model's empirical specification is as follows. 𝑦𝑖𝑡 = ∑ 𝜆𝑖𝑗 𝑦𝑖,𝑡−𝑗 + ∑ 𝛿𝑖𝑗 𝑋𝑖,𝑡−𝑗 + 𝜇𝑡 + 𝑖𝑡 𝑞 𝑗=0 𝑝 𝑗=1 where 𝜆𝑖𝑡is a scalar, 𝑢𝑖𝑡 is a group-specific effect, and i = 1, 2,... n for the number of cross sections, and 𝑥𝑖𝑡 is a vector of 𝐾 × 1 regressors. the disturbance term is an i(0) process if the variables are i(1) and co-integrated. the co-integrated variables' response to any departure from long-term equilibrium is one of their key characteristics. this trait implies that the system's variables' errorcorrection dynamics are affected by deviations from equilibrium. in order to create the error correction equation, it is typical to re-parameterize the above equation as ∆𝑦𝑖𝑡 = ∅𝑖 𝑦𝑖,𝑡−𝑗 − 𝜃𝑖 𝑥𝑖,𝑡−𝑗 ∑ 𝜆𝑖𝑗 ∆𝑦𝑖,𝑡−𝑗 + ∑ 𝛿𝑖𝑗 ∆𝑥𝑖,𝑡−𝑗 + 𝜇𝑡 + 𝑖𝑡 𝑞−1 𝑗=0 𝑝−1 𝑗=1 the speed of adjustment is indicated by the error correction parameter ∅𝑖. there is no proof that variables have a long-term association if ∅𝑖=0 exist. according to the prior assumption that variables reflect a convergence to long-run equilibrium in the event of any disturbance, it is expected ∅𝑖 that is negative and statistically significant. . the current study uses the unit root tests developed by levin, lin, and chu (llc) and i'm pesaran, and shin (ips) to account for the nonstationarity of dynamic panels as the analysis lengthens. regardless of size, culture, or population, the panel nations may have commonalities and interdependence because of economic globalisation. heteroscedasticity, serial correlations, and cross-sectional dependences (cd) between variables are now more likely as a result. according to baum's [13] technique, heteroscedasticity will be identified using the modified wald statistic for groupwise heteroskedasticity, and the presence of a serial correlation will be assessed using the wooldridge test for autocorrelation in panel data. the pesaran cd statistic test will be utilised in this study to determine the cross-sectional dependence among the variables in the equation below: south asian review of business and administrative studies vol. 4, no. 2, dec 2022 171 𝐶𝑀𝑅 = √ 2𝑇 𝑁(𝑁 − 1) ( ∑ ∑ √𝑇𝑖𝑗𝑝𝑖𝑗2 𝑁 𝑗=𝑖+1 𝑁−1 𝑖=1 ) t represents the passage of time, n represents the cross-sectional dimension, and pij 2 represents the pairwise residual cross-sectional correlation coefficient. the judgment instruction states that the alternative hypothesis is cross-sectionally dependent, whereas the null hypothesis is crosssectionally independent with cd n. (0, 1). a pair-wise (rahman, alam, et al. 2022) interconnection of slanted test will be used to detect causation among the variables in the current investigation, using the techniques of (rahman, alam, et al. 2022). 𝑌𝑖,𝑡 = 𝜋0,𝑖 + 𝜋1,𝑖 𝑌𝑖,𝑡−1 … … … … … . +𝜋𝑘,𝑖 𝑌𝑖,𝑡−1 + 𝛿1.𝑖 𝑋𝑖,𝑡−1 + 𝜗𝑖,𝑡 table 1. variables description and data sources. variables description of variables unit of measurement data sources cmr child mortality mortality rate, under 5 (per 1,000 live births) wdi co2 climate change co2 wdi edu education government expenditure on education, total (% of gdp) wdi health environmental health immunization, dpt (% of children ages 12-23 months) wdi ws water sanitation people using at least basic sanitation services (% of the population) wdi table 2: descriptive statistics variable cmr co2 edu health ws mean 47.90421 1.690132 2.586115 77.02105 45.97320 median 48.20000 0.384025 2.593520 77.00000 37.14470 maximum 90.50000 7.883095 4.770000 99.00000 93.69684 minimum 11.90000 0.037055 1.015059 27.00000 10.92753 std. dev. 21.84068 2.694781 0.922697 17.96449 26.48550 skewness 0.075049 1.548072 0.490239 -0.478146 0.742663 kurtosis 1.888722 3.548176 2.442002 2.386418 2.254148 jarque-bera 4.977474 39.13446 5.037760 5.110111 10.93485 probability 0.083015 0.000000 0.080550 0.077688 0.004222 table 2 displays the modeled variables. this table shows the mean, median, skewness, kurtosis, and minimum and maximum values for each variable from 1971 to 2020. cmr has an average value of 47.90421 with the smallest value of 11.90000 and an extreme value of 90.50000. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 172 furthermore, the co2 value varied from 0.037055 to 7.883095, with a mean score of 1.690132. the average value of eg is 1.569144, with values ranging from -2.119071 to 2.213161. similarly, the mean poverty level is 3.536812, with a range of 3.004345 to 4.163560. pop has a middling value of 1.461974, with a low-slung of -0.266960 and a height of 2.870201. (al azies and dewi 2021) is used to test residual normality. the probability value indicates that the ws or co2 null hypothesis of "normally distributed residuals" is rejected. however, in macro data analysis, we can proceed with our model without satisfying the normality assumption because it will not disrupt the relationships (amemiya, 1974). unit root test different panel unit root tests with varying specifications were presented by levin, lin, and chu (2002) based on the presumption of entity-specific intercept terms and temporal trends. according to (khan), the llc test homogenizes the autoregressive coefficient, which determines whether or not there is a unit root. this test, which looks at the unit root problem, is based on adf regression. the standard llc test with an exclusive intercept term may be written as ∆𝑦𝑖,𝑡 = 𝛾0𝑖 + 𝑝𝑦𝑖𝑡−1 + ∑ 𝛾1𝑖 ∆𝑦𝑖,𝑡−𝑗 + 𝜇𝑖,𝑡 𝑝𝑖 𝑖=0 in the overhead equation, 𝑢𝑖𝑡 is the disturbance term that is supposed to be sovereign across panel entities and follows an arma stationary process for every cross-section, while 𝛾0𝑖 is the constant term that is supposed to vary across cross-sectional entities while p is the same autoregressive coefficient and 𝛾𝑖 is the lag order. 𝜇𝑖,𝑡 = ∑ 𝛾1𝑖 ∆𝑦𝑖,𝑡−𝑗 + 𝑖,𝑡 ∞ 𝑗=𝑜 the hypothes are as h0: ρi = ρ = 0 (null hypothsis) ha:ρi = ρ < 0 the all llc model predicts that will remain constant across entities under the null and alternative hypotheses based on t-statistics. 𝑡𝑝 = 𝑝 𝑆𝐸(𝑝) under the conditions of independently and normally distributed error terms and cross-sectional independence, panel regression test statistics converge. standard normal distribution when n and t ∞ and√ 𝑁 𝑇 0 . however, test statistics if crosssectional units are dependent, the error term is serially correlated, and there is a temporal trend, the function does not converge to 0. in these instances, llc provided a modified version of test statistics. 𝑡𝑝 = 𝑡𝑝 − 𝑁𝑇𝑆𝑁 𝜎0 −2(𝑃)𝜇𝑚 ∗ 𝜎𝑚 ∗ 𝜇𝑚 ∗ and 𝜎𝑚 ∗ are modified mean and standard deviation, values of these are generated from monte carlo simulation by llc (1993). ips unit root test i'm, pesaran, and shin (ips), 2003, developed a test to verify the unit root in a heterogeneous panel. although the overall test statistics are based on the arithmetic mean of individual series, the adf test to individual series is used in this test. adf may designate a series as. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 173 ∆𝑦𝑖,𝑡 = 𝑤𝑖 + 𝑝𝑦𝑖𝑡−1 + ∑ 𝑝𝑖,𝑗 𝑝𝑖 𝑗=1 ∆𝑦𝑖,𝑡−𝑗 + 𝑣𝑖,𝑡 ips test allows for heterogeneity in 𝑣𝑖,𝑡 value, the ips unit root test equation may be written as 𝑡𝑇 = 1 𝑁 ∑ 𝑡𝑖,𝑡 (𝑝𝑖 ) 𝑁 𝑖=1 where 𝑡𝑖,𝑡 is the adf test statistics, 𝑝 is the lag order. in the adf test statistics is calculated as: 𝐴𝐼 = √ 𝑁(𝑇) 𝑉𝐴𝑅(𝑡𝑇 ) [𝑡𝑇 − 𝐸(𝑡𝑇 )] 𝐯𝐚𝐫𝐢𝐚𝐛𝐥𝐞𝐬 𝐋𝐞𝐯𝐢𝐧, 𝐋𝐢𝐧 &𝐂𝐡𝐮 𝐭𝐞𝐬𝐭 𝐬𝐭𝐚𝐭𝐢𝐬𝐭𝐢𝐜𝐬 𝐈𝐦, 𝐏𝐞𝐬𝐚𝐫𝐚𝐧 𝐚𝐧𝐝 𝐒𝐡𝐢𝐧 𝐖 − 𝐬𝐭𝐚𝐭 i(0) i(1) i(0) i(1) cmr -6.755 (0.031) 12.109 (0.000) -5.533 (0.024) 2.886 (0.000) co2 8.844 (0.764) -7.023 (0.000) 8.864 (0.782) -6.907 (0.000) edu -0.724 (0.719) -11.28 (0.000) -0.902 (0.743) -11.51 (0.000) health -6.536 (0.021) -6.406 (0.000) -4.219 (0.011) -8.228 (0.000) ws 0.759 (0.705) -6.290 (0.000) 1.015 (0.705) -2.339 (0.000) table 3. when it comes to macroeconomic data, the unit root test is a superior method to descriptive statistics for evaluating the suitability of secondary data for ardl modeling. through these experiments, it is discovered that child mortality and health are stable at a level, whereas co2 emission, education, and water sanitation are not. however, they become stationary at the first difference. furthermore, since co2 emission, edu, and ws are stationary at the first difference and both unit root tests (levin, lin, and chu test statistics and i'm, perasan, and shin) produce nearly identical results, these variables are i (1) variables. it means that the unit root test demonstrated that the stationarity requirement for using ardl modeling on current time series data is met. the lag order selection criteria were chosen after evaluating the data's stationarity, and the results are shown in table 3. the two primary lag indicators are aic and sc. because the aic has the lowest value at lag 2, two delays are chosen for the current ardl modeling. table 4 displays the lag order option for the current data. the ardl model below depicts the current connections that must be investigated: south asian review of business and administrative studies vol. 4, no. 2, dec 2022 174 𝐶𝑀𝑅𝑡 = 𝑦0 + 𝑦1𝐶𝑀𝑅𝑡−1 + 𝑦2𝐶𝑂2𝑡−1 + 𝑦3𝐸𝐷𝑈𝑡−1 + 𝑦4𝑊𝑆𝑡−1 + ∑ 𝑎1 𝑝 𝑖=1 ∆𝐶𝑀𝑅𝑡−1 + ∑ 𝑎2 𝑞 𝑖=1 ∆𝐶𝑜2𝑡−1 + ∑ 𝑎3 𝑞 𝑖=1 ∆𝐸𝐷𝑈𝑡−1 + ∑ 𝑎4 𝑞 𝑖=1 ∆𝑊𝑆𝑡−1 + 𝑡 in this equation, 𝛼1, 𝛼2, , 𝛼3, , 𝛼4represent the short-term parameters while 𝑦1, 𝑦2, 𝑦3, 𝑦4, represent the long-term parameters. the ardl bound test is first used to validate the co-integration, in which the critical values are calculated and compared in instruction to evaluate the long-term association of co2, edu, health, and ws emission with cmr. to decide on co-integration, the f-statistics must be better than the highest lower sure, as advised by pesaran et al. (2001). table 4. long run estimates lag log l lr fpe aic sc hq 0 -1042.494 na 930798. 27.93318 28.08768 27.99487 1 -168.2032 1608.695 0.000136 5.285419 6.212414 5.655558 2 22.76652 325.9217 1.64e-06 0.859559* 2.559051* 1.538148* 3 32.29463 14.99090 2.54e-06 1.272143 3.744130 2.259181 4 62.44437 43.41562 2.31e-06 1.134817 4.379300 2.430303 as well as a maximum value the null hypothesis for the f-bound co-integration test is as follows: 𝑦1 = 𝑦2 = 𝑦3 = 𝑦4 = 0 it denotes that the null hypothesis predicts no co-integration in the data, whereas the alternative hypothesis predicts co-integration in the data. the co-integration test results are shown in table 4. -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 15 20 25 30 38 40 lg_cmr structural residuals -2 -1 0 1 2 3 15 20 25 30 38 40 lg_co2 structural residuals -2 -1 0 1 2 3 15 20 25 30 38 40 lg_edu structural residuals -2 -1 0 1 2 3 15 20 25 30 38 40 lg_health structural residuals -3 -2 -1 0 1 2 3 15 20 25 30 38 40 lg_ws structural residuals var structural res idu al s us in g ch ole sk y (d .f . ad jus te d) f actors south asian review of business and administrative studies vol. 4, no. 2, dec 2022 175 table 4.ardl model: long run variables coefficient std. error t-statistics prob. c02 -1.040 1.691 -0.615 0.504 edu 2.492 0.618 4.027 0.000 health -0.099 0.065 -1.511 0.135 ws -2.225 0.119 -1.885 0.064 short run variables coefficient std. error t-statistics prob. cointeq01 -0.0155 0.021 -0.726 0.470 d(co2) -0.244 0.444 -0.550 0.584 d(edu) -0.021 0.036 -0.587 0.558 d(health) 0.005 0.005 -0.972 0.334 d(ws) -4.611 3.989 -1.156 0.252 c -0.068 0.965 -0.070 0.944 ∆𝑙𝑛𝐶𝑀𝑅𝑡 = 𝛼0 + ∑ 𝛼1∆𝑙𝑛𝑐𝑚𝑟𝑡−1 + 𝑝 𝑖=1 ∑ 𝛼2∆𝑙𝑛𝑐𝑜2𝑡−1 + 𝑝 𝑖=1 ∑ 𝛼3∆𝑙𝑛𝐸𝐷𝑈𝑡−1 + 𝑝 𝑖=1 ∑ 𝛼4∆𝑙𝑛ℎ𝑒𝑎𝑙𝑡ℎ𝑡−1 𝑝 𝑖=1 + ∑ 𝛼5∆𝑙𝑛𝑤𝑠𝑡−1 + 𝑝 𝑖=1 𝜆1𝑙𝑛𝐶𝑀𝑅𝑡−1 + 𝜆2𝑙𝑛𝑐𝑜2𝑡−1 + 𝜆3𝑙𝑛𝐸𝐷𝑈𝑡−1 + 𝜆4𝑙𝑛𝐻𝐸𝐴𝐿𝑇𝐻𝑡−1 + 𝜆5𝑙𝑛𝑊𝑆𝑡−1 + 𝑡 in this equation, the expression from λ_1 to λ_5 depicts the long-run relationship between the variables, while the expression from α_1 to α_5 with the summation signs corresponds to the shortrun dynamics of the variables. on the other hand, α0 represents drift constant and ε_t is gaussian white noise table 4; indicating result of long result ardl model findings confirm that there is a negative. the probability value show that there is a insignificant relation between co2 and cmr at 5percent. it employs that increase 1percent in co2 in this response there will be decrease of 1.02 units in cmr. conclusion newborn death amount is the major factor nation economy child impermanence rate is the main key of any nation development. infant death under the age of five is the important factor of the budget that can be resolved by increasing in education of father and mother of children. in developing countries. nevertheless, the reduce in co2is also effect in reducing the child mortality rate. this study explains the encouraging and negative effects of health and environmental factor related with long run and short run. furthermore, this study originates an important effects of water sanitation and facilities. theoretical and practical implication this learning has many theoretic, concrete, and financial suggestions: firstly; this learning spreads the presented literature on poverty by empirically establishing the direct and indirect effect ofco2. secondly; the government should ensure contact to clean water to poor sector for culture of child mortality reduction in developing countries. thirdly; environmental factor responsible agencies in developing countries should step in to clean air act to reduce environmental degradation and pollution. fourthly; the government should provide subsidies to promote the health facilities. fifthly; the availability of cheap and equal education for poor sector also to reduce child mortality. references breitung, j., & pesaran, m. h. 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(2021). association between the concentration and rangeability of cystatin c and mortality of covid-19 patients with or without type 2 diabetes mellitus: a retrospective analysis. frontiers in endocrinology, 12, 713. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 178 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 129 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas the role of emerging digital technologies in the apparel industry of pakistan alveena malik, department of education, institute of southern punjab, multan, pakistan muhammad imran, universiti utara malaysia article details abstract history revised format: nov 2022 available online: dec 2022 keywords industry 4.0 technologies, additive manufacturing, big data, cloud computing, internet of things, augmented reality, firm performance, employee involvement, mass customization capability purpose: current study examines the relationship of industry 4.0 on firm performance through process mediation of employee involvement and mass customization capabilities. the motivation to conduct the current study was driven by the decreasing trend of pakistan apparel exports and the inconsistent findings in the literature on the relationship among variables. design/methodology/approach: population of the study are the export members firms of hs code 61 and hs code 62 apparel manufacturing firms. from 1564 firms 10000 senior and middle management identified as a population. structural equation modeling (sem) was used to test the research model. findings: the results reveal that industry 4.0 technologies positively impacted firm performance. study findings also show the process mediation of employee involvement and mass customization capability between big data and firm performance. implication/originality/value: to the best author's knowledge, this is the first attempt to examine the process mediation of employee involvement and mass customization capability on the relationship between industry 4.0 and pakistan apparel firm performance. © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: alveenamalik589@gmail.com doi: https://doi.org/10.52461/sabas.v4i2.1618 introduction customers' demand for apparel is ever-changing (de silva, rupasinghe, & apeagyei, 2019). in this rapidly growing business landscape, customers are demanding individually personalized products at a rational price in a speedy time creating immense pressure on the organization (e.g narian & ullah 2020; zhang et al., 2019, wiengarten et al., 2017). from last decades, mass customization (mc) is the dominant strategy for reacting to the customer's demand for goods variety that distingue businesses in the vastly competitive and segmented marketplace (dimitris mourtzis & vlachou, 2018). nowadays organizations are using mass customization capability as a considered approach to fulfill customers' requests and competitive advantage (dou et al., 2020; https://journals.iub.edu.pk/index.php/sabas mailto:alveenamalik589@gmail.com https://doi.org/10.52461/sabas.v4i2.1 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 130 ullah & narain 2020a; ullah & narain 2020b). prior studies report that industry 4.0 is beneficial for mass customization. industry 4.0 technologies (i4 technologies) include "cloud computing (cc)", "big data (bd)", "internet of things (iot)”, “additive manufacturing or 3d (am)” (ardito, petruzzelli, panniello, & garavelli, 2019; wijewardhana, weerabahu, nanayakkara, & samaranayake, 2020). pakistan is far behind in the adoption of industry 4.0. pakistan's apparel sector contribute 20 percent share in country textile exports (javed & atif, 2019) and provides a significant contribution to pakistan's economy (hamid et al., 2014; javed & atif, 2019). the clothing industry of pakistan is the export-oriented and main source of foreign exchange income (abbas, hsieh, techato, & taweekun, 2020). it contributes 1.4 percent to world apparel export. according to the pakistan board of investment and trade in the 2017-2018 financial year, the apparel industry contributes 11.4 percent to pakistan's export. regardless of this, the clothing industry is facing a decrease in growth rate (imran, 2018). wto report (2019) shows a negative 11 percent annual change in exports of textiles and pakistan was even not in the top ten clothing exporter countries list. pakistan bureau of statistics released data that reported the textile and appeal exports declined 15 percent in june 2019 as compared to june 2018. in june 2018 pakistan's textile export was $1.19 billion but in june 2019 it is $1.01 billion (statistic, 2020). textile clothing and apparel export growth of pakistan is not as much as other developing countries such as bangladesh, vietnam, etc. pakistan's apparel industry export is still lagging as it contributes to only 1.10% of global export as compared to bangladesh's 7.66 (memon, aziz, & qayyum, 2020). the current study has a few major contributions. this study has tried to establish the underpinning by introducing industry 4.0 as the mechanism to enhance mcc through which firm may enhance their overall performance because pakistan has been facing challenges allied to technology. the current study is the first study that examined the process of mediation of ie and mcc. by investigating the impact of i4 technologies, this study can scientifically induce the apparel firms' leaders that introducing i4 technologies and ei is essential for the enhancement of mcc and fp. literature review and theoretical framework according to newbert (2008), a resource-based review (rbv) argues that a firm can improve its performance if firm owns and exploits valuable and rare competencies. maijoor and witteloostuijn (1996) firms have two kind of resource tangible and intangible resources that bind semipermanently to the organization. to finish the organization targets resources and capabilities needed, assets owned by the firm are known as resources, and the skill to utilize and unite resources are known as capabilities (salam, 2019). in this research, i4 technologies are considered as the strength and the physical resource which is adopted as an enabler of mcc through the employee involvement according to hitt, xu, and carnes (2016) presence of one resource must influence positively other resources. technologies and fp am and fp according to majeed et al. (2021), am has huge potential in increasing the "material effectiveness", "reduce life cycle impacts" and allow enhanced "functionality". researchers suggest that am may reduce product development costs and it enhance firm innovation performance. h1.1: am has a significant positive effect on fp. bd and fp bd is characterized by 5vs such as "high volume", "variety", "velocity (data renewed at very high speed)", "veracity" (veracity means data is associated with biased, inconsistency, and south asian review of business and administrative studies vol. 4, no. 2, dec 2022 131 incompleteness), and "value" (). by adopting bd, a firm can greatly improve its financial performance (akter, wamba, gunasekaran, dubey, & childe, 2016; chen, mao, & liu, 2014). h1.2: bd has a significant positive effect on fp. cc and fp cc can provide improvement in the form of “operation”, “management”, and “strategic efficiency” (vitari & raguseo, 2020). cc influence positively on fp through better quality and innovation and provides time-saving as well as cost-saving (ilmudeen, bao, & alharbi, 2019; kathuria, mann, khuntia, saldanha, & kauffman, 2018; ooi, lee, tan, hew, & hew, 2018). h1.3: cc has a significant positive effect on fp. iot and fp in iot devices are interlinked with 'electronic', 'software', 'sensor', "network connectivity" and "actuators'" and these devices receive and communicate important information in real-time. iots provides vigor change management in mc (khayer, bao, & nguyen, 2020). according to leong and koshijima (2018), iot has positive effects on a firm financial performance. extant literature confirmed that iot influences positively on fp (tang, huang, & wang, 2018). h1.4: iot has a significant positive effect on fp. ar and fp by implementing ar, the organization can improve their productivity and efficiency and it also helps firms to provide training to their workers successfully (khayer et al., 2020). although ar influences positively on overall fp and it provides efficiency, enhanced productivity, and performance improvement (lai, tao, leu, & yin, 2020). it provides the opportunity of receiving information and shape an interaction of employees in a new way (jetter, eimecke, & rese, 2018). h1.5: ar has a significant positive effect on fp. technologies and ei am and ei adoption of am in manufacturing processes, required employees with skills and knowledge of the latest technologies and materials, to have the capability to integrate and advance processes (zigart & schlund, 2020). highly competent and empowered employees with adequate training to cope with problems when arise are important for am implementation (simpson, williams, & hripko, 2017). h2.1: am has a significant effect on ei. bd and ei working with i4 technologies, employees gain autonomy and it enhances operational decisionmaking (pérez-pérez, gómez, & sebastián, 2018). i4 creates opportunities for employees to take better and more effective data-driven decisions (rosin, forget, lamouri, & pellerin, 2022; wankhede & vinodh, 2021). h2.2: bd has a significant effect on ei. cc and ei cc is an effective technology that helps firms for monitoring and tracking the production sales and can improve the production decisions (bousdekis, lepenioti, apostolou, & mentzas, 2021). in the t&a, the adoption of cc are providing the benefits of value creation and enhanced competitiveness (guo, wong, & guo, 2014; mladenow, fuchs, dohmen, & strauss, 2012). h2.3: cc has a significant effect on ei. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 132 iot and ei iot has the potential for empowering employees and its helps employees to behave in empowered ways (kushida & pingali, 2014). iot can make decision-making easier and helps employees to do their work efficiently with the minimization of errors (leyer, richter, & steinhüser, 2018). h2.4: iot has a significant effect on ei. ar and ei according to sievers, reil, rimbeck, stumpf-wollersheim, and leyer (2021) results that i4 can influences employee commitment and ei and digital transformation due to i4 requiring the need for ei. h2.5: ar has a significant effect on ei. technologies and mcc am and mcc according to (tortorella, miorando, caiado, nascimento, & portioli staudacher, 2021) am is an mc and personalization-enabling technology. am provides features manufactured to produce several parts in an identical bunch (mueller, 2012). am provides significant cost-saving and benefits to buying customized low volumes of goods at mass production prices (gibson, rosen, & stucker, 2010). h3.1: am has a significant positive effect on mcc bd and mcc bd provides mcc with a new idea of life. big data can provide the organization with the ability to respond to the new customer according to his/her preferences and buying habit. it is widely used to enable mass customization (delic, eyers, & mikulic, 2019). tien (2012) reports the bda as a key supporter of technology for the successful implementation of mc. h3.2: bda has a significant positive effect on mcc. cc and mcc cc technology helps firms to overcome these challenges related to the mass customization (morabito, 2015). adopting the cc organization enables it to respond the customer demands efficently (kai et al., 2017; lanza, peukert, & steier, 2022). h3.3: cc has a significant positive effect on mcc. iot and mcc iot is one of the core technology to achieve mcc. iot provides technical infrastructure for mc(tieng, chen, cheng, & yang, 2016). according to (salvendy, 2001), iot is the enabler of product development with higher mass customization. h3.4: iot has a significant positive effect on mcc. ar and mcc ar could fulfill customer and market demand by working combining with mc (calegari, avalone, & fettermann, 2020). implementation of mc needs the active involvement of customers and ar provides such an environment to involve all stakeholders in the product design process (d mourtzis, synodinos, angelopoulos, & panopoulos, 2020). h3.5: ar has a significant positive effect on mcc. ei and mcc successfully implantation of mass customization production in a firm requires highly trained designers and personnel so that they fulfilled customers' requirements timely and efficient and also for the firm's enhanced market competitiveness (luh, wang, chang, chang, & chu, 2013). south asian review of business and administrative studies vol. 4, no. 2, dec 2022 133 according to jain, garg, and kansal (2022), human resource plays an important role in achieving the firm mcc a study by kakati (2002) founds that employees with a stock of knowledge and skills effectively improved the firm mcc. h4: ei has a significant positive effect on mcc. mcc and fp mcc helps the manufacturer to provide customization of products by using innovative ways that result in an enhancement in the fp (zhang, qi, & guo, 2017; zhang, qi, zhao, & duray, 2015) cited by (jitpaiboon, dobrzykowski, ragu-nathan, & vonderembse, 2013). few studies report that the complexity linked with mc operations may threaten the firm success and performance (åhlström & westbrook, 1999; zhang, guo, huo, zhao, & huang, 2019). h5: mcc has a significant positive effect on fp. mediating role of ei and mcc implementation of industry 4.0 is very risky because digitalization enhances the use of the digital system and also changes the demands placed on employees. through ei firms may reduce such risks (zhang, qi, & zhao, 2011). i4 technologies enabled manufacturing firms to manufacture with reduced time and provide the development of a value chain and also improved product quality with the enhancement in fp (digmayer & jakobs, 2018). a study by kamble, gunasekaran, and gawankar (2018) finding shows that i4 technologies and fp have a positive and significant relationship in the context of the pakistan retail industry. and through the implementation of i4, pakistan's retail industry's overall performance would increase. prior studies have highlighted that industry 4.0 and fp have a positive and significant direct relationship. the following mediating hypotheses we proposed to be examined. h6.1: ei mediate the relationship between am and fp. h6.2: ei mediate the relationship between bda and fp. h6.3: ei mediate the relationship between cc and fp. h6.4: ei mediate the relationship between iot and fp. h6.5: ei mediate the relationship between ar and fp. h7.1: mcc mediate the relationship between am and fp. h7.2: mcc mediate the relationship between bda and fp. h7.3: mcc mediate the relationship between cc and fp. h7.4: mcc mediate the relationship between iot and the fp. h7.5: mcc mediate the relationship between ar and the fp. the current study also focuses on the role of ei and mcc as a process mediation linking i4 technologies and fp. based on the theoretical approach and previous findings in the literature we hypothesized the following: h8.1: the relationship between am and fp will be process mediated by ei and mcc. h8.2: the relationship between bda and fp will be process mediated by ei and mcc. h8.3: the relationship between cc and fp will be process mediated by ei and mcc. h8.4: the relationship between iot and fp will be process mediated by ei and mcc. h8.5: the relationship between ar and fp will be process mediated by ei and mcc. theoretical framework south asian review of business and administrative studies vol. 4, no. 2, dec 2022 134 methodology measures questionnaire is adopted from prior researches. study variables were measured using 7 point likert scale, where 1 mean strongly agree and 7 means strongly disagree. fp measure adopted from ali and xie (2021) study. fp will measure by using two approaches such as "market effectiveness" and "firm profitability". seven-point scale with -3 "much worse than competitor" to +3 "much better than competitor. am items scale adopted from ) study. to access the bd, we used four adopted items from the scale developed by n. a. morgan, vorhies, and mason (2009). bda measures through attitudinal and behavioral questions. to measure cc, we drew on the 5 items from (niaki, nonino, palombi, & torabi, 2019). to measure iot, 5 items were adopted from imran (2018) study. ra item scale was adopted from oliveira, thomas, and espadanal (2014) study. imran (2018) adapted these items from (masood & egger, 2019) and (masood & egger, 2019). ei item scale was adopted items from shah & ward (2007). practices of ei are "problem-solving teams", "suggestion programs", "product/process improvement" and "cross-functional training". six items were used from tu, vonderembse, and ragu-nathan's (2001) and liu's (2006) instruments to measure mcc. 3.2 sample current cross sectional population was senior management (higher-level managers) and middle managers of apparel industry firms hs code 61 and hs code 62. hs code 61 export chapter refers to "knitwear and hosiery" and hs code 62 export chapter refers to "readymade garment". the unit of the analysis of the study is the export hs code 61 and 62 firms. zhu, li, wang, and chen (2010) also used this unit of analysis in their study. more than 10,000 senior and middle management are working in these identified firms. according to jia, guo, and barnes (2017), if the population is more than 10000 then a 370 sample size is recommended for the study. for the current study, 370 is the sample size. the current study employed a systematic random sampling method for data collection. due to the financial and time constraints, the selection systematic sampling approach was justified. data collection was done from march 2021 to december 2021. self-administrated survey was used. the researcher received a total of 250 usable questionnaires out of 370 questionnaires which translates into a reply rate of 67 %. descriptive and inferential statistics spss and pls-sem were applied to the collected data. of the 250 respondents, 76 % were male and 34 % were females. in terms of education, 24.3 % were graduates, 67% had a master's degree and 8.7 had other degrees. in terms of position, 36.2 % were middle managers and 63.8 % were senior managers. in terms of experience, 38.3 % had 1-3 years of job experience, 27.5 % had 3-6 years of job experience, 18.4 % had 6-9 years of job experience and 15.8 % had more than 9-year job experience. after receiving all responses, data were made suitable for further analysis by eliminating outliers and missing values. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 135 results and discussion measurement model the measurement model includes checking the reliability of the data. it can be accessed through reliability and convergent validity. reliability and convergent reliability according to iqbal, huq, and bhutta (2018) composite reliability refer to the level to which items set shows that latent construct in a reliable manner. table 1 presented the cronbach alpha and composite reliability. this study used both tools to measure internal consistency. the results of table no.1 confirmed that all the study constructs are reliable and are in the acceptable range. average variance extracted (ave) was used for testing the convergent validity. the value of ave more than 0.5 shows that convergent validity exists. however, to obtain the acceptable criteria of ave few items were deleted based on less factor loading. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 136 discriminant validity: it refers that items of a different construct are not overlapping. according to d. w. morgan and krejcie (1970),discriminant validity measures the share variance among each construct. the present study uses the hair, black, babin, anderson, and tatham (2010) measure of discriminant validity. table 3 results indicate that the square root of each ave is larger than the off-diagonal elements in their conforming row and column. structural model testing the direct effect: to determine the path coefficient statistical significance bootstrapping method was used. in this regard, each path coefficient t value was produced. table 4 summarized the direct effects results. with regards to the results obtained for hypothesis testing relating to i4 technologies on fp. i4 technologies such as am, bd, cc, and ar positively impacted fp with the following respective results; (β= 0.056, t=2.126) (β= 0.012, t=1.915) (β= 0.01, t=2.78) (β= 0.049, t=2.183,) indicating support for h1.1, h1.2, h1.3, and h1.5. iot impact on fp is not significant (β= 0.056, t=1.382) resulting in a rejection of h1.4. with regards to the results obtained for hypothesis testing relating to industry 4.0 technologies on ei. i4 technologies such as am, bd, cc, iot, and ar positively impacted ei with the following respective results; (β= 0.077, t=1.918) (β= 0.013, t=3.42) (β= 0.057, t=2.362) (β= 0.067, t=3.328) (β= 0.04, t=18.981) indicating support for h2.1, h2.2, h2.3, h2.4, and h2.5. results show that industry 4.0 technologies other than cc are positive enablers of the mcc of the firm. as for the results of industry 4.0 technologies, results for am, big data, iot, and ar are (β= 0.011, t=1.9) (β= 0.069, t=2.799) (β= 0.065, t=4.356) (β= 0.068, t=5.43) are respectively and they positively enabler mcc of the firm indicating that h3.1, h3.2, h3.4, and h3.5 are supported. the result of industry 4.0 technology cc respectively (β= 0.071, t=0.363) indicates that cc is not the positive enabler of mcc of a firm, and h3.3 is rejected. ei impact on mcc is significant (β= 0.071, t=6.152) resulting in an acceptance of h4. furthermore, mcc was found to be influenced positively on fp with (β= 0.052, t=1.841) and thus supporting h5. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 137 testing the mediating role of ei: smart pls 3.0 was used for examine the mediating role of ei. the table 5 result indicates that employee involvement mediate the relationship of am and fp with (β= 0.032, t=2.014) thus, supporting h6.1. ei did not mediate the relationship bd-mcc with (β= 0.027, t=0.72) thus, rejecting h6.2. table 6 results indicates that ie mediates the relationship of cc and fp with (β= 0.027, t=2.215) thus, supporting h6.3. based on the table results, indicate ei fully mediates the relationship of iot-mcc with (β= 0.033, t=2.946) thus, supporting h6.4. the results obtained show that ei mediates the relationship of ar and fp with (β= 0.057, t=5.785) thus, supporting h6.5. testing the mediating role of mcc: mediating results are displayed in table 5. the table 5 shows that mcc mediate the relationship of am and fp with (β= 0.009, t=0.227) thus, rejecting h7.1. mcc did not mediate the relationship bd-fp with (β= 0.012, t=1.532) thus, rejecting h7.2. the table 5 results shows that of mcc did not mediate the relationship of cc and fp with (β= 0.008, t=0.324) thus, rejecting h7.3. table 5 results indicate that mcc fully mediates the relationship iot-fp with (β= 0.016, t=1.7) thus, supporting h7.4. the table 5 results show that mcc mediates the relationship of ar and fp with (β= 0.021, t=1.646) thus, supporting h7.5. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 138 testing the process mediation of ei and mcc: the study proposes the process mediating of ie and mcc between industry 4.0 technologies and fp (fig1). the process mediation role of ei and mcc was examined with the help of smart pls 3.0. mediating results are displayed in table 7. as for the process mediating role of ei and mcc on the am-fp relationship, the results obtained show that ie and mcc did not process mediate the mentioned relationship with (β= 0.005, t=1.313) thus, rejecting h8.1. furthermore, we did find support for h8.2 because the process mediation effect of ie and mcc on bda-fp was significant (β= 0.003, t=0.628). the 8.3 hypothesis was rejected as the process mediation of ei and mcc between cc-fp is not significant (β= 0.004, t=1.389). finally, we did not find support for h8.4 because the process mediation effect of ie and mcc on iot-fp was not significant (β= 0.006, t=1.497). furthermore, we did find support for h8.5 because the process mediation effect of ie and mcc on bd-fp was significant (β= 0.017, t=1.801). predictive relevance: table 4 indicate the cross redundancy for employee involvement, mass customization capability and firm performance to be 0.716, 0.68 and 0.767 correspondingly and thus the predictive validity of the value is proven. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 139 conclusion study results indicate the importance of i4 technologies for apparel firm mcc. it is evident that through successful implementation of i4 technologies in operations pakistan apparel firm would be able to respond to the customer ever-changing demands, capability to make customize products quickly on a larger market scale and at a lower cost comparable to mass production, respond to global competitions easily and innovation challenge, through these technologies firms can predict the future trend and patterns that help firm in achieving competitive advantages, produce good with low cost, low wastages with reducing time lead production cycle. global challenges encourage manufacturers to produce with efficiency competitive to mass production. the positive relationship between i4 and mcc is reported by many studies (compeau, higgins, & huff, 1999; fornell & larcker, 1981). for advancing manufacturing, industry 4.0 was proposed, so that firms realize shorter product life cycles and offer highly customized products in a cost-efficient way (shi et al., 2020). this industrial revolution has an extremely favorable effect on mass customization, improvement in production completion time, lower waiting time, high utilization of equipment and higher customer satisfaction, continuous improvement in firm performance, and competitive advantage. pakistan's apparel industry should enhance the adoption of i4 in its operations. pakistan apparel export is facing negative growth that why i4 technology is the need of the hour. without the latest technology transformation, this industry can't compete in the global market competitions. customer demand for tailored and unique products is also increasing, for fulling the customers' demands quickly, with quality products and with low cost, the apparel industry needs technological advancement. without this advancement, this industry cannot survive in this global competitive market. practical implication: from the industry practitioners' perspective, the current study evidence suggests that industry 4.0 technologies adopted by firms play an important role in mcc that can play a significant and contributing part towards the fp of the apparel industry. current research also provides input to the government of pakistan to formulate and implement industry 4.0 technologies toward the enhancement and sustainability of the apparel industry exports, especially given global competition from both developed and developing economies countries. theoretical implication: current study attempt to contribute to the understanding of the i4, ei, mcc, and fp relationship. current study contributes to the literature by shedding light on the importance of i4 in the apparel south asian review of business and administrative studies vol. 4, no. 2, dec 2022 140 industry, especially the pakistan apparel industry. the bulk of literature regarding this topic is limited to developed countries and such as the current study extends literature dedicated to i4, ie, mcc, and fp to the apparel industry of pakistan, which is a developing county. lastly, testing this process model also attempts to find the solution for the issues of decreasing trend of pakistan apparel exports and better fp. limitation and recommendation: 1. the first limitation concerns the cross-sectional research design for the inspection of the hypothesis's relationships. it is highly recommended that longitudinal studies are conducted to investigate the impact of industry 4.0 on mcc on fp. 2. the current study used a single respondent from a firm may introduce biases. it is recommended that future studies adopt various informers from a single firm for the minimization of biasness of results from an individual response from a firm. 3. future studies may be conducted in collaboration with government export agencies to generate better survey responses. 4. the current study focused on pakistan, a developing country with a semi-industrial economy. this study can be replicated in further countries with the same stage of economic development for comparative analysis. 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(2020). evaluation of augmented reality technologies in manufacturing– a literature review. paper presented at the international conference on applied human factors and ergonomics. south asian review of business and administrative studies vol. 5, no. 1, june 2023 27 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318; issn (e): 2710-5164 volume 5, no.1, june 2023 journal homepage: https://journals.iub.edu.pk/index.php/sabas expected shortfall and value at risk as alternative of market beta to explain cross-sectional stock returns adeel nasir, lahore college for women university, pakistan umar farooq, fast school of management, national university of computer and emerging science (fast-nuces), pakistan kanwal iqbal khan, university of engineering and technology, lahore, pakistan article details abstract history revised format: may 2023 available online: june 2023 keywords risk management; expected shortfall; value at risk capm; three-factor model; five-factor model the objective of this study is to risk-return model with value at risk (var) and expected shortfall (es) as the systematic risk factors. notably, it is tested whether var and es can be used as an alternative to market beta in the traditional capital asset pricing model (capm), a three and fivefactor model. data is collected for non-financial companies listed on the pakistani stock exchange. var and es are calculated at two levels of significance, i.e., 95% and 99%. results showed that the traditional market beta of capm, three and five-factor model is not following the risk-averse behaviour of investors. conversely, var and es showed a positive relationship with stock returns supporting the 'high-risk, high return' theory. furthermore, investment, profitability and size factors become redundant with var and es as systematic risk factors. therefore, it is recommended that var and es may be used the alternative to market beta to predict the cross sections of stock excess returns. © 2023 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: kanwal.khan@uet.edu.pk doi: https://doi.org/10.52461/sabas.v5i1.1780 introduction over the last few decades, there is a substantial increase in the financial models concerning asset pricing theory. these models are developed to predict risk-return in relation to making efficient investment decisions. capm was the seminal work by lintner (1965) and sharpe (1964) that identified market exposure as a primary systematic risk factor in predicting cross-sectional stock returns. capm argued that the co-movement (beta) between stock and market returns could explain differences in cross-sectional stock returns. however, various studies documented that the capm beta does not present such cross-sectional differences (chiah et al., 2016). furthermore, capm assumes a positive relationship between the stock return and market returns. however, the literature showed mixed results for this relation. for instance, benz (1981) found the negative risk and return relationship with the increase in firm size. such irregularities in capm evolved the literature of multifactor models of asset pricing. multifactor models argue that the irregularities in capm are due to risk factors that cannot be https://journals.iub.edu.pk/index.php/sabas mailto:kanwal.khan@uet.edu.pk https://doi.org/10.52461/sabas.v5i1.1 south asian review of business and administrative studies vol. 5, no. 1, june 2023 28 diversified. investors require compensation in the presence/absence of such factors. therefore, such anomalies are needed to control using an appropriate variable in single-factor capm. for instance, benz (1981) found that the irregularity of capm can be controlled by using firm size. similarly, basu (1983) found that the price-earning ratio and market beta better predict the stock returns than the capm model. fama and french's (1993) three-factor model is among the most cited multifactor models that used both size and value factors to control capm anomalies. several studies have shown that the three-factor model outperformed single-factor capm (fama & french, 1998; griffin, 2002; javid & ahmad, 2011; peter et al., 2017). the five-factor model of fama and french (2015) is another popular enhancement of the threefactor model. fama and french (2015) added investment and profitability factors. they included these two factors due to empirical results showing a strong association of profits and investment with stock returns. chiah et al. (2016) demonstrate the superior performance of the five-factor model. following the multifactor theory, this research also postulates that irregularities are associated with single-factor capm due to the inability of market exposure to control idiosyncratic risks that are not minimised by a well-diversified portfolio. this research argues that it is inappropriate to use market exposure as a proxy for systematic risk. instead, these are the tails of distribution that can better control systematic and idiosyncratic risks in explaining the differences in cross-sectional stock returns (khan et al., 2021). var and es represent the risk base in the tail distribution of asset returns. var is defined as the security’s or asset’s worst expected loss for a certain time horizon at a certain level of significance (naqvi et al., 2019). based on the left tail of the asset return distribution, var provides the risk of asset or portfolio of assets with maximum loss prediction (lin et al., 2010). contrarily, expected shortfall (es) estimates the worst expected loss average at a specified confidence interval. we argued that both var and es could be an alternative to market beta and other risk factors in explaining the stock returns. like capm beta, which calculates the systematic risk based on whole distribution, var and es, following the extreme value theory (evt), conduct systematic risk, but it checks the data's left tail behaviour. schedule et al. (2016) explained that es and var provide superior risk estimation and are less prone to model misspecifications. therefore, var and esbased models can provide superior explanations to cross sections of stock returns. the research's primary objective is to compare the var and es-based models with traditional single, three and five-factor models. we first compared the original capm, three and five-factor models in explaining the differences in cross-sectional stock returns. then we modified the capm, three-factor, and five-factor model by replacing market beta with var and es. we compared the var and es-based models with traditional models to find the best-fitted model. it also tested whether four firm-specific factors used in the five-factor model become redundant in var and es-based models. we tested these comparisons for the data from pakistan stock exchange. though most previous studies compared the five-factor and three-factor models with capm, few studies investigated the role of var and es in this respect. particularly, comparing the var and es-based models with different significance levels while controlling idiosyncratic risk factors provided in the five-factor model is a theoretical research gap. moreover, to the best of the author's knowledge, no study has yet investigated the es-based model in pakistan. nasir et al. (2021) worked on a similar objective of comparing var and es with capm beta in the three and five-factor models. their study focused on the time series dependency of returns to risk factors. this study adds to the body of knowledge by taking a different approach to check the cross-sectional risk and return relationship. pakistan is a developing country where south asian review of business and administrative studies vol. 5, no. 1, june 2023 29 the stock market shows variations. in such volatile markets, the study of the distribution's tails could be more helpful in explaining the stock returns. thus, the outcome of this research will contribute both theoretically and practically. the objective of comparing var and es-based models with capm, three and five-factor models will provide theoretical contributions. while the unique settings of an emerging market, i.e., pakistan, will offer practical implications for investors intending to invest in pakistan stock exchange. literature review and theoretical background markowitz (1952) provided the groundwork for asset pricing by explaining the asset allocation based on mean-variance analysis. his efficient frontier allows selecting the portfolio providing specific returns at the lowest risk. their portfolio theory was based on the reduction of risk through diversification. after that, lintner (1965) and sharpe (1964) extended their work and argued that expected stock returns are non-diversifiable systematic risk functions. the proposed capm uses market exposure as a single factor in predicting cross-sections of stock returns. however, the implication of capm is based on the efficient market hypothesis; when a market reflects all the true information timely, then expected returns could be measured by adjusting additional compensation against additional systematic risk. in actual practice, markets are not efficient, and information is not adjusted accurately and timely. consequently, capm may provide an inaccurate estimation of expected returns. the emergence of models based on arbitrage pricing theory (apt) focuses on the multifactor model to control the non-diversifiable anomalies, which were ignored by capm. three-factor model by fama and french (1993) is one of the famous multifactor models. fama and french (1993) added value and size factors to the market beta factor of capm. they argued that investors require more compensation against small-size and value stocks. various studies explored other anomalies in predicting expected stock returns, but the three-factor model remained the most cited and eminent multifactor model. in 2015, in addition to the three-factor model, fama and french tested the significance of two more factors, i.e. profitability and investment (fama & french, 2014). various studies have shown the superiority of three and five-factor models in explaining cross-sectional stock returns (fama & french, 2017; lohano & kashif, 2018). however, this research argues that traditional market beta used in single-factor and multifactor models is not an appropriate benchmark of systematic risk to compensate. instead, these are the fat tails of the distribution that can better represent the risk to explain the variations in stock returns (aziz & ansari, 2017; huang et al., 2012); stated tail effects can be captured by using value at risk (var). var is the worst expected loss for a certain time horizon (diamandis et al., 2011). it can help developing countries where stock markets are more volatile from the tail sides as a proxy of risk. for instance, chen et al. (2014) found that var significantly explains the variations in the cross-sectional stock returns in the case of an emerging market, i.e. taiwan stock exchange. similarly, aziz and ansari (2017) indicated a positive relationship between var and risk premium. the objective of this study is to explore the difference between the well-researched systematic risk factors i.e. market beta and var as the estimation capacity of cross-sectional stock returns of pakistani firms. furthermore, this study explores the comparison between two significant extreme value models i.e. var and es. a significant number of studies have investigated the capm, three and five-factor models for pakistani listed firms. for instance, kashif, ilyas, et al. (2018) found that capm misspecified the cross-sectional stock returns while the three factors and five-factor models better explain the differences in stock returns. kashif, saad, et al. (2018) provided evidence of contrarian strategy. they found that single-factor capm is misspecified due to not controlling the effects of contrarian strategy. conversely, the three and five-factor models explained the risksouth asian review of business and administrative studies vol. 5, no. 1, june 2023 30 adjusted abnormal returns due to contrarian strategy. asad and cheema (2017) found that the qfactor model is superior to the capm and three-factor model in the pakistan stock exchange. they also found that the size effect is only relevant for small firms while large firms are not affected. similarly, fatima et al. (2017) reported the significant impact of value and size factors on returns of firms' prices psx. javid and ahmad (2011) investigated the changes in beta during bearish/bullish market conditions. they observe an increase in market beta with a bullish trend in the market and a decrease in market beta with a bearish trend. their results further revealed that the three-factor model better predicted the cross-sectional stock returns as compared to capm. various other studies also compared the three and five-factor models and found their superiority (ameer, 2013; lohano & kashif, 2018; peter et al., 2017; zada et al., 2018; zhang et al., 2019). thus, the literature on asset pricing in pakistan shows that multifactor models better predict stock returns than single-factor capm. contrary to traditional capm and three-factor models, iqbal and azher (2014) used var as a proxy of risk in predicting pakistani stock returns. their results showed that significant risk premiums are associated with var. however, var is a parametric approach assuming a normal distribution of returns with non-normal skewness or excess kurtosis (khan et al., 2020). in violation of such assumptions, a nonparametric approach is required to calculate risk from the tail of the distribution. conditional value at risk or expected shortfall (es) is one such nonparametric approach (chen, 2008). similar to var, es focus on the tail of the distribution and measures the average of some percentage of worst expected losses (khan et al., 2019). var is a percentile of the loss distribution, while es shows the average losses scheduled within that percentile. in this way, var can be defined as the lower boundary of es. sarykalin, serraino and uryasev (2008) contended that es is a better proxy of risk than var, especially in optimisation problems. var does not control the losses exceeding its value. in comparison, es controls its effect by taking the average and portraying a comprehensive picture of the distribution's tails. similarly, es contains good mathematical properties such as continuous and convex functions compared to var which can have discontinued functions (sarykalin et al., 2008). therefore, it can be more appropriate to use es as a risk measure rather than var. this research intends to compare parametric var and nonparametric es performances with traditional asset pricing models. the study further tests the significance of cross-sectional models of var and es, by including non-systematic risk factors such as profitability, investment, size and value. to the best of the author's knowledge, no study has yet tested and compared these implications of var and mainly es-based models at different significance levels in the pakistan stock exchange. therefore, this research will help the investor predict stock returns using an appropriate proxy of systematic risk. research methodology we have collected data from the 527 listed non-financial firms of the pakistan stock exchange (psx) from 1998 to 2015. daily stock price data is extracted from the business recorder and the pakistan stock exchange website. we use daily stock returns to calculate market beta, value at risk and expected shortfall values separately. accounting information is collected from the state bank of pakistan (sbp) annual publications. daily stock returns are calculated using the following formula south asian review of business and administrative studies vol. 5, no. 1, june 2023 31 𝑅𝑖 = 𝑃𝑡−𝑃𝑡−1 𝑃𝑡−1 (01) ri represents the daily stock return while pt and pt-1 are the current and previous trading dates' stock prices. from the annual data, the following single-factor capm model as proposed by sharpe (1964), lintner (1965) and black (1972) is analysed using the ordinary least square (ols) regression model. 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1market_β𝑖 + 𝜀𝑖 (02) ri – rf represents the stock excess returns. market risk is represented by market-β. equation 2 will test the cross-section effect of market beta on excess stock return for sample data. similarly, equation 3 represents fama and french (1992, 1993, and 1996) three factor model. it analyses the effect of systematic risk factor, along with size and value on stock returns. 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1market_β𝑖 + 𝛽2ln (𝑀𝐸) + 𝛽3𝐵𝑀 + 𝜀𝑖 (03) where log of market equity (ln(me)) is represented as size, value factor is the book to market ratio (bm). the five-factor model introduced by fama (2015) which is illustrated by equation four. 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1market_β𝑖 + 𝛽2 ln(𝑀𝐸) + 𝛽3𝐵𝑀 + 𝛽4𝑂𝑃 + 𝛽5𝐼𝑁𝑉 + 𝜀𝑖 (04) the investment factor (inv) represents the change in the value of the total asset from the previous two years to the previous year, profitability factor (op) is taken as the operating profit of the previous year from the financial reports divided by the book to market ratio of prior years. the first part of this research explores the performance of the above three models for sample data. the second part of the current research replaces market beta with var to estimate various asset pricing models. it is argued that using var as an alternative to the market can better predict crosssectional stock returns. var is the maximum expected loss at a certain confidence level for a level of investment. the parametric var of security can be calculated using the following formula. var α = [n*(1α)]th return value of the arranged distribution we have calculated separate var and es for each stock; we have used the historical method to compute var values. we arranged the security returns and used [n*(1α)]th return value of the minimum side of the distribution as the var. “n” is the total number of observations, and we used daily returns for the estimation period of one year as prescribed by the basel iii accord. we used two values of the level of confidence “α”, i.e. 95% and 99%. a 95% confidence interval is common among managers and researchers; it gives a high value of var, and a 99% level of confidence is used as the benchmark rate of the basel iii accord (mager, 2012). we have used the simple using var, we modified single-factor, three-factor and five-factor models in the following way. we used the normal distribution of past returns to calculate var. the normality assumption is supported by the central limit theorem. the normal distribution is the most common distribution for var calculation; basel iii accord allows banks to use a normal distribution with variancecovariance, historical distribution or monte carlo simulation approach to measuring var. the selection of the method is the bank's discretion (mager, 2012). the method of calculating var and es is according to extreme value theory, which uses various methods to check the extreme thresholds in the given data 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝑉𝑎𝑅 + 𝜀𝑖 (06) 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝑉𝑎𝑅 + 𝛽2ln (𝑀𝐸) + 𝛽3𝐵𝑀 + 𝜀𝑖 (07) (05) south asian review of business and administrative studies vol. 5, no. 1, june 2023 32 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝑉𝑎𝑅 + 𝛽2 ln(𝑀𝐸) + 𝛽3𝐵𝑀 + 𝛽4𝑂𝑃 + 𝛽5𝐼𝑁𝑉 + 𝜀𝑖 (08) the third part of this research provides an explanation of various asset pricing models concerning the expected shortfall as the systematic risk control mechanism. the formulation of es is provided in equation nine: 𝐶𝑜𝑛𝑑𝑖𝑡𝑖𝑜𝑛𝑎𝑙 𝑉𝑎𝑅 𝑜𝑟 𝐸𝑆 = ∑[𝑋|𝑋 ≤ 𝑉𝑎𝑅∝] 𝑁 (09) equation (9) represents the es of stock returns calculations. it defines the extreme expected losses and provides the average work expected loss that investors sustain. the “x” operator represents the stock returns and for the calculation of es, these returns are below the threshold level of var. some of “x” is divided by the number of observations which is denoted by “n”. we have used daily returns for a year as the estimation period. we used two values of the level of confidence, i.e. 95% and 99% with the normal distribution of past returns. 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝐸𝑆 + 𝜀𝑖 (10) 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝐸𝑆 + 𝛽2ln (𝑀𝐸) + 𝛽3𝐵𝑀 + 𝜀𝑖 (11) 𝑅𝑖 − 𝑅𝑓 = 𝛼𝑖 + 𝛽1𝐸𝑆 + 𝛽2 ln(𝑀𝐸) + 𝛽3𝐵𝑀 + 𝛽4𝑂𝑃 + 𝛽5𝐼𝑁𝑉 + 𝜀𝑖 (12) results and discussions table 1 of descriptive statistics shows that the average beta of the sample stocks is 0.372 with high variations of 0.423. it is also notable that some of the stocks documented negative beta as the minimum value of beta is -1.417. it refers to the inefficiency of the single-factor model as the basic assumption is violated. results also show that the average var95 value is -0.48 compared to the value var99 (-1.25). this indicates that the results of var could provide different statistics at the varied level of significance for var. table 1: descriptive statistics variables mean standard deviation minimum value maximum value beta 0.40 0.42 -1.41 2.48 ln(me) 1.99 1.03 0.00 3.00 bm 0.24 0.85 -4.50 2.78 inv 0.11 0.24 -0.50 4.13 op 0.09 0.74 -6.62 7.27 var 95 -0.05 0.05 -0.81 0.00 var 99 -0.13 0.12 -1.59 0.00 es 95 -0.00 0.00 -0.03 0.00 es 99 -0.00 0.00 -0.01 0.00 table 2 shows the results of single-factor models with stock excess returns as the dependent variable and market beta, var and es as independent variables. results show that market beta (model 1) has a significant negative relation with excess returns. such a significant negative relationship is also consistent with (theriou et al., 2005). these results negate the notion of risk aversion and a positive risk-return relationship. hence, the implication of the capm model in the pakistan stock exchange to predict stock returns is inappropriate. one of the reasons for the negative beta can be the inclusion of cyclic stocks in our sample. table 2. one factor cross-sectional risk and return model south asian review of business and administrative studies vol. 5, no. 1, june 2023 33 this table represents the single-factor ols regression model with the traditional capm model in model 1, and from models 2 to 5, es and var are used as the systematic risk factors. var and es are tested at both 95% and 99% levels of confidence. non-italic values are coefficients. italic formatted values in parathesis represent p-values for significance. bold formatted values are insignificant values ri rf models 1 2 3 4 5 market beta -0.002 (0.000) var-95 0.0031 (0.000) var-99 0.0034 (0.000) es-95 0.0864 (0.000) es-99 0.3410 (0.000) constant 0.0012 0.0005 0.0008 0.0008 0.0009 (0.000) (0.000) (0.000) (0.000) (0.000) adj. r2 0.50 0.50 0.52 0.51 0.62 f-value 258.16 47.1 58.013 44.33 66.68 chi-square 516.32 94.26 116.02 88.66 133.36 table 2 also shows that the other four models portray significant positive effects of var and es on stock returns. results are also showing that the risk premium of var99 (0.0034) and es99 (0.3410) is more significant than var95 (0.00309) and es95 (0.0864), respectively. it is consistent with the theory that an increase in the risk of tail effects requires compensation. it shows that var and es can control the impact of cyclic stock. adj. r2 of these models are also high as compared to the classical capm model. it is also notable that all four models (particularly model 2 var 95%) documented an intercept value close to zero, indicating a shallow autonomous effect on stock market excess returns. thus, it can be concluded that var and es-based models can better predict the expected stock returns as compared to capm in pakistan stock exchange. notably, es based model showed the highest explanatory power as its adjusted r2 is 0.62. similarly, table 3 compares the three-factor model based on the market beta, var and es. results show that market beta (model 6) depicts a negative relation between market returns and stock excess returns in the traditional three-factor model. the traditional three-factor model (model 6) also revealed a positive coefficient for size. these results are inconsistent with the theory as market beta and size effect should possess positive and negative beta, respectively. this indicates that adding the size and value effect to single-factor capm is still ineffective in predicting stock returns in the case of the pakistan stock exchange. table 3 is also showing that a positive risk premium is associated with both var and es. however, size effects become redundant in model 7 (var95) and model 9 (es95). conversely, model 8 (var99) and model 9 (es99) have a significant adverse effect indicating more risk premium for small stocks than large stocks, supporting the risk-averse behaviour of investors. table 3 also shows that substantial risk premium is associated with value stocks in all five models (models 610). results also show that the constant term is insignificant for models 7 (var95) and 9 (es95). these results indicate that the significance level for var and es affects the redundancy and autonomous effect of size and constant term, respectively. south asian review of business and administrative studies vol. 5, no. 1, june 2023 34 table 3. cross-sectional ordinary least square model of three factor model the table posits the three-factor models using the ordinary least square model. model 6 is the traditional three-factor model using systematic risk factor (market beta), size and value as the idiosyncratic risk factors. var-95 and es-95 are taken as the systematic risk factor at a 95% confidence interval. var-99 and es-99 are systematic risk factors at a 99% level of confidence. non-italic values are coefficients. italic formatted values in parathesis represent p-values for significance. bold formatted values are insignificant values ri rf models 6 7 8 9 10 beta -0.0035 (0.000) var-95 0.0039 (0.000) var-99 0.00583 (0.000) es-95 0.1072 (0.000) es-99 0.4855 (0.000) lnme 0.0044 0.0000 -0.00152 -0.0007 -0.0014 (0.000) (0.851) (0.021) (0.271) (0.034) bm 0.0007 0.0004 0.0004 0.0004 0.0004 (0.000) (0.000) (0.000) (0.000) (0.000) c -0.0097 0.0002 0.0048 0.0025 0.0045 (0.000) (0.813) (0.006) (0.143) (0.010) adj. r2 0.55 0.44 0.58 0.42 0.63 f-value 252.78 42.16 34.63 22.15 30.78 chi-square 1009.7 168.65 138.51 88.59 123.11 similarly, table 4 provides regression analyses using market beta, var and es as the systematic risk factor in five-factor model. the five-factor model also provided similar results to the threefactor model in market beta, var and es, size, and value effect. results showed insignificant investment factors for all five models. similarly, except for var95 (model 12), all the models also revealed a negligible impact on profitability. it indicates that in pakistan stock exchange, no risk premium is associated with investment and profitability. we also applied quantile regression to the five-factor model using es, var and market beta to obtain a robust analysis. tables 1 to 4 provide models based on ordinary least squares, using average returns as the dependent variable. quantile regression offers a comparison to ols regression with median stock returns as the dependent variable; table 5 provides the results of the 20th, 50th and 80th deciles of excess returns. results show that in 80th quantile regression, fivefactor models (model 25-30) based on the market beta, var and es provided similar results. the only difference is the insignificant risk premium of var95 in model 27. all the models showed insignificant size effects and significant effects on value stocks, investment and profitability. it is also found that the constant term is significant but very small for models 26-30 of the 80th quantile regression. this finding concludes that the traditional five-factor model can be applied to distinguish cross-sectional stock returns from high excess returns. table 4. five-factor models this table provides the regression analysis using capm, es and var as the systematic risk factors in the five-factor model. non-systematic risk factors are size (lnme), value (bm), investment (inv) and south asian review of business and administrative studies vol. 5, no. 1, june 2023 35 profitability (op). var-95 and es-95 are taken as the systematic risk factor at 95% confidence interval. var-99 and es-99 are systematic risk factors at 99% level of confidence. non-italic values are coefficients. italic formatted values in parathesis represent p-values for significance. bold formatted values are insignificant values ri rf models 11 12 13 14 15 beta -0.004 (0.000) var 95 0.004 (0.000) var 99 0.006 (0.000) es 95 0.1065 (0.0000) es 99 0.483831 (0.000) lnme 0.0045 0.0000 -0.0015 -0.0007 -0.0014 (0.000) (0.839) (0.024) (0.291) (0.038) bm 0.0007 0.0004 0.0004 0.000417 0.00039 (0.000) (0.0000) (0.000) (0.0000) (0.0000) inv -0.0002 -0.0001 -0.0001 0.0001 -0.0001 (0.055) (0.107) (0.286) (0.2858) (0.2596) op 0.0000 0.0001 0.0000 0.0000 0.0001 (0.585) (0.035) (0.536) (0.407) (0.482) c -0.0098 0.0002 0.0047 0.0023 0.00439 (0.000) (0.823) (0.007) (0.155) (0.012) adj. r2 0.55 0.54 0.74 0.72 0.73 f-value 168.96 29.34 23.34 15.07 20.82 chi-square 1013.7 176.03 140.02 90.43 124.89 table 5. five-factor model (quantile regression model) the table provides the 20th, 50th and 80th quantile regression analysis of the five-factor model both var and es are used with 95% and 99% confidence levels. non-italic values are coefficients. italic formatted values in parathesis represent p-values for significance. bold formatted values are insignificant values panel a: twenty percentile of stock excess returns models 16 17 18 19 20 beta -0.0003 (0.240) var95 0.0095 (0.000) var 99 0.0085 (0.000) es-95 0.2372 (0.000) es-99 0.9130 (0.000) lnme 0.0014 0.0006 -0.0005 -0.0004 -0.0012 (0.037) (0.110) (0.295) (0.380) (0.003) bm 0.0003 0.0004 0.0003 0.0004 0.0003 (0.001) (0.000) (0.000) (0.000) (0.000) inv -0.0001 -0.0001 -0.0001 -0.0001 -0.0000 (0.000) (0.000) (0.660) (0.0008) (0.000) south asian review of business and administrative studies vol. 5, no. 1, june 2023 36 op 0.0001 0.00011 0.0000 0.0000 0.0001 (0.356) (0.263) (0.982) (0.853) (0.592) c -0.0050 -0.0025 0.0009 0.0005 0.0027 (0.005) (0.014) (0.505) (0.660) (0.009) panel b: median percentile of stock excess returns models 21 22 23 24 25 beta 0.0003 (0.092) var95 0.0041 (0.000) var 99 0.0040 (0.000) es-95 0.0814 (0.000) es-99 0.422 (0.000) lnme 0.0003 0.0004 -0.0002 -0.00001 -0.0005 (0.454) (0.184) (0.482) (0.92) (0.205) bm 0.0003 0.0004 0.0003 0.0003 0.0003 (0.000) (0.000) (0.000) (0.000) (0.000) inv -0.0001 -0.0001 -0.00001 -0.00001 -0.00001 (0.000) (0.000) (0.000) (0.000) (0.000) op 0.0001 0.0001 0.0001 0.0001 0.00001 (0.000) (0.000) (0.001) (0.000) (0.011) c -0.0007 -0.0008 0.0012 0.0005 0.0020 (0.477) (0.351) (0.20) (0.540) (0.083) panel c: eightieth percentile of stock excess returns models 25 27 28 29 30 beta 0.0004 (0.022) var-95 0.002 (0.274) var-99 0.0020 (0.036) es-95 0.0587 (0.0142) es-99 0.1960 (0.0313) lnme -0.0008 -0.0004 -0.0007 -0.0007 -0.0008 (0.085) (0.260) (0.103) (0.095) (0.052) bm 0.0004 0.0004 0.0004 0.0004 0.0004 (0.000) (0.000) (0.000) (0.000) (0.000) inv -0.0001 -0.0001 -0.0001 -0.0001 -0.0001 (0.000) (0.000) (0.000) (0.000) (0.000) op 0.0000 0.00001 0.00001 0.00001 0.00001 (0.005) (0.000) (0.000) (0.000) (0.000) c 0.004 0.0031 0.0040 0.0038 0.0042 (0.002) (0.000) (0.001) (0.001) (0.000) table 5 also shows that the traditional five-factor market beta becomes insignificant for median and 20th quantile regression analysis. hence, it can be concluded that market beta becomes redundant for stocks having low excess returns. conversely, var99, es95, and es99 showed consistent results (positive coefficient) for all three 20th, 50th and 80th quantile regression south asian review of business and administrative studies vol. 5, no. 1, june 2023 37 analyses. the constant term of var99 and es95 in both the 20th and 50th quantile regression is also insignificant. these results conclude that var and es-based models better predict the stock returns as compared to market beta regardless of the level of excess returns. notably, in the case of var 99 for low excess return stocks (20th quantile regression), all the idiosyncratic risks except the value effect become redundant. therefore, practitioners are recommended to use var and esbased models in predicting the stock returns while making investment decisions in pakistan stock exchange. the coefficient value of es is more than var, which indicates the strong impact of es against var but with the same direction and significant p-values. pakistani stock market is a highly volatile market in comparison with the established markets of developed economies. we prove it by empirically reporting the negative capm beta, which indicates the presence of cyclical stocks in psx. the study provides a model based on var and es, which follows the risk-averse assumption despite volatile cyclical stocks. this study provides an alternative measure of systematic risk compared to the well-established asset pricing models applied in well-established markets of developed countries. our study provides a superior explanation of var and es. moreover, es is a better estimator than var, and it is following the findings of (sarykalin et al., 2008). conclusions this study adds to the body of knowledge by providing an additional explanation of var and es as the systematic risk factor against the well-established provisions of capm beta. capm, three and five-factor models are used as the traditional models. the capm defines risk that requires compensation under the risk-averse assumption, and it represents the stock price deviation from a well-established portfolio. in comparison, three and five-factor models argued that other idiosyncratic risks also explain stock returns significantly. these factors are size, value, investment and profitability. this research argues that market beta used in capm, three and five-factor models is not representative of systematic risk in the pakistani stock market. our results showed that market beta is negative and divergences from the 'high-risk, high return' theory. cyclical stocks might be the reason for the negative effect of market beta. this study provided alternate models with systematic risk factors such as var and es in single, three and five-factor models. both es and var showed a positive relationship with stock returns indicating high stock returns with increased risk value. it follows the ‘high risk, high return’ theory. there is a similar direction and significance of var and es coefficients, but stock returns are more sensitive to es coefficient change. we find these implications for the data from a developing country, i.e. pakistan. in developing countries like pakistan, stock markets are more volatile, increasing var and es's importance in predicting stock returns. our results also showed that var and es could also control the size, investment and profitability effects. therefore, it is recommended that investors should rely on var and es as a proxy of risk in estimating the cross-section stock returns to invest in the pakistan stock exchange. limitations and future research this study indicates that the difference is significant among capm beta, var and es measures and the model can be applied to stock exchanges of various developed and developing economies. after applying this model to developed and developing stocks the overall market model based on var and es can be formed to replace the capm estimates. the study deploys the normal distribution of returns to calculate var and es. future research can provide robust results with the help of contemporary methods which use other distributions to calculate var and es. due to the data unavailability, some stocks with missing annual data or daily return frequency data are dropped from the sample. the study assumes the normal distribution of data to calculate the value at risk. the objective is to check the penetration of value at risk and the expected shortfall to the south asian review of business and administrative studies vol. 5, no. 1, june 2023 38 controlling mechanism of systematic risk. more 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(2019). alternative three factor model for asset pricing for the investment, market and profitability premium in emerging south asian review of business and administrative studies vol. 5, no. 1, june 2023 40 markets: an evidence from pakistan’s stock exchange. 2019 16th international conference on service systems and service management, icsssm 2019, 1–6. https://doi.org/10.1109/icsssm.2019.8887691 south asian review of business and administrative studies vol. 2, no. 2, june 2020 129 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 2, no.2, december 2020 journal homepage: https://journals.iub.edu.pk/index.php/sabas impact of merger and acquisitions on firm value in financial sector firms of pakistan muhammad usman qureshi, comsats university of islamabad, pakistan muhammad azeem, bahauddin zakariya univeristy, pakistan muhammad irfan javaid, comsats university of islamabad, pakistan article details abstract history revised format: nov 2020 available online: dec 2020 keywords mergers and acquisitions, shareholders returns, firm value mergers and acquisition are not only related to accounting measures of performance of firms but it also affects the wealth of shareholders either positively or negatively. according to hubris hypothesis, the merger and acquisition announcement brings negative effect to shareholders wealth and decreases the abnormal return in post period. the present study took this analysis separate for long and short run period. to capture immediate effect on shareholders return study used market model to calculate abnormal returns and employed the t-test on it to check the significant differences in two sample data set. out of 12 cases of m&a eight mergers showed negative abnormal returns for post period with statistical significance at 1% level, two at 5% and two acquiring firms reduced returns were not statistically significant. overall on the basis of most m&a results, the study concluded consistent results with earlier studies. the long run analysis employed by using ohlson (1995) model for firm value with introducing dummy variable for the pre and post period. the results indicated coefficient of dummy for merger was -0.52 with statistical significance at 1% level which is demonstrating negative effect on share price which ultimately reduces the returns. the study concluded that merger and acquisition announcement bring negative effect on shareholders return either for short run or long time period. © 2020 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: qaziusman05@cuivehari.edu.pk doi: https://doi.org/10.52461/sabas.v2i2.452 introduction introduction merger and acquisitions are common in now a days' corporate world. acquisition of one company by another means that company a will take over the company b, in this way identity of company a, only, will remain. second is the establishment of a new company by the merger of two different companies. in which no company will remain with his identity, but a new company c will come in existence. the rationale at the back of these m&a (mergers and acquisitions) stands upon synergy affect that value of merged company is more than sum value of those two separate https://journals.iub.edu.pk/index.php/sabas mailto:qaziusman05@cuivehari.edu.pk https://doi.org/10.52461/sabas.v2i2.452 south asian review of business and administrative studies vol. 2, no. 2, june 2020 130 companies. to cope with scarcity, companies use to merge together for some benefits, most common are: economy of scale, economy of scope and synergy. the reasoning behind acquiring a corporation is to make stockholder wealth in addition to that of the summation of the two separate corporations. this underlying principle becomes more appealing when companies face hard times. to achieve more competitiveness and cost efficiency more strengthen corporations will acquire others or the companies will approach for mergers with a hope to achieve a larger market share and to gain more efficiency. because of these potential benefits, target companies will often agree to be purchased when they know they cannot survive alone (brealey and myers 2003). the trend of business combinations started after depression of 1883 in united states and this first wave lasted till 1904 which created monopolies. the second wave of mergers and acquisitions then named as of oligopolies from 1916-1929. after that conglomerates mergers were began to seen from 1965 and hostile takeovers as well so on not only in us and europe but also in japan and australia. m&a have always been concerned with bringing benefits including operating efficiency, financial strength and an increase in the survived firm because of more gains, reduction in expenses, reduction in earnings volatility, achievement of economy of scale and scope and in increased market power as well. according to ogden, jen & o’connor (2003), the motives behind these m&a were to achieve both operating and financial synergy, diversification, bankruptcy avoidance and self interest of bidder’s management. in this instance post merger entity should have more strength in terms of profitability, efficiency and in value of firm in markets which leaves gap for researchers. many research studies from the beginning of m&a have focused on approximately every aspect of firm affected by business combinations. in finance literature there are many issues which have been addressed including m&a effect on firm profitability, efficiency, risk performance, liquidity and share performance to some extent as well. particularly in pakistan many researchers have been conducted on this phenomenon but those studies focused on firm performance in context of profitability. as actual goal of firm is to get increase in shareholder's wealth, therefore we must evaluate the performance of company in stock market as well. this study is trying to focus on the impact of business combinations, either in the shape of mergers or acquisitions, on the firm value. roll (1986) gave the hubris theory regarding mergers and acquisitions in which he presented a hypothetical view that m&a affect the value of merging firm. according to hubris theory when an announcement of m&a is made, the stock price of a target company (firm which got an offer to be acquired) goes up and bidding firm (firm which gives offer to purchase) faces loss in terms of decline in stock price. the basic reasoning behind the theory is that when a corporation gives an offer of m&a to target firm then that target firm’s shareholders become ready to transfer their shares in response to offer at high premium that has been offered by bidding firm, consequently the share price of target firm increases. according to hubris theory share holders of bidding company become overconfident and pay too much to target company for merger or acquisition. the increased stock price of target firm leads to increase in firm value. on the other side bidding firm faces a capital loss in stock value because it has to pay cash or some additional shares to target stockholders, as a result, decreased price of share of bidding firm leads to decrease in value. number of studies tested this argument and documented consistent results with hubris hypothesis for both acquiring and acquired firm that target company have earned abnormal returns whereas bidding firm share value declined. ruback (1983) reviewed thirteen studies and examine share prices around the m&a announcements and documented that target company earns thirty percent abnormal return on average. according to jarrell, brickley, and netter (1988) study which analyzed 663 m&a offers between 1962-1985 and documented the results of abnormal returns of target company’s as 19%, 35% and 30% for 1960, 1970 and 1980-1985 respectively. however, the results for bidding firms are mixed, contradictory and not clear. many researchers depicted the south asian review of business and administrative studies vol. 2, no. 2, june 2020 131 abnormal returns for bidding firm after an announcement of m&a in financial sector including cornett and de (1991), james and weir (1987) and desai and stover (1985). but the cornett and tehranian (1992) and neely (1987) reported negative returns for the bidding companies. this study is intended to test the hubris theory hypothesis about bidding firm that either survived firm’s value increase or decrease subsequent a m&a. in pakistan there are some studies on the subject matter but they are limited to financial performance of firm in context of profitability and studies which focused on effect on firm value are not comprehensive in nature and results are not able to generalize or are not enough to accept or reject the hubris hypothesis. mahmood et al. (2012) tried to see the effect of m&a on share price. they took the sample of 8 pakistani companies listed at kse (karachi stock exchange) which passed through merger and acquisition from 2000-2002. they depicted the share prices of one month before and after of merger and acquisition on a graph and found 5 bidding companies had increase in share prices, 2 had decrease in share prices and one was not subject to any change. study concludes that overall positive effect found on share price. this was good initiative to contribute in literature but this study lacks statistical technique which could give enough evidence for conclusions. we could not found any other study in pakistan which focused on this phenomenon, so there is a gap found to shed light on this arena that either results of m&a in case of developing countries, particularly in pakistan, are consistent with that of developed markets as they claim to being more efficient, nyse for example. the investors in pakistan are somewhat different as compared to developed market investors because of market differences, regulations and information available to them. the m&a announcement effect therefore could be different on share price. despite of pakistan, many studies on the subject matter in the entire world reveals the short term analysis and have very least focus on long term effect. harjito and sulong (2006) attempt to examine the effect of m&a completion announcement on stock price behavior. they took event study of two malaysian banks, calculated their abnormal returns and applied t test to check the significant differences for 60 days before and after of event. they concluded m&a as positive information inconsistent with hubris hypothesis. sugiarto (2000) also calculated abnormal returns but found consistent results with hubris hypothesis that target firms gain more abnormal returns than that of bidding firms. all these studies lack the long run effect of the event. some studies tried the long run performance in stock market by just increasing the event window and employing t test and checked significant differences as done in short run analysis. tuch and o’sullivan (2007) conducted a comprehensive review on empirical studies taken on m&a effect on value either on short run or on long run. the study revealed mixed results but depicted that short run abnormal returns were better whereas long run analysis shown negative effect. the present study intended to perform analysis of m&a events on both short run and long run. in short run daily closing prices around event date would be used to calculate abnormal return with daily market index on the basis of market model. t test will be employed to check the significant differences as found in literature. the long run analysis would be different in nature. this study will use ohlson (1995) traditional linear model for share price determination which uses financial information, book value per share and earnings per share. the first study to see the relationship between accounting variables and share prices is assumed to be of ball and brown (1968). after that dividend discount model used but has been criticized much for its constant dividend assumption. many studies concluded that stock prices have too many variations and these variations are not predictable by just dividends. believers of this thought include studies of flavin (1983), marsh and merton (1986) and mankiw, romer & shapiro (1991). ohlson (1995) model then used from late of 20th century to determine share price and it was showed that earnings and book value have positive and significant effect on stock price. kadri, aziz and mohamed (2009) used this model for sample of malaysian firms, callao, jarne & lainez (2007); and gaston, et al. south asian review of business and administrative studies vol. 2, no. 2, june 2020 132 (2010) also demonstrated the same results. nazir et al. (2010), azeem & kouser (2011) and malik, qureshi & azeem (2012) are studies conducted on pakistani sample used the ohlson (1995) model and found that earning and book value are variables which positively and significantly affect the share price of kse listed companies. research problem research got attention on m&a effect as they started in late of 19th century. researches concerned with financial economics seek to result on shareholders wealth as it is a solely goal of firm. most of researches only went for event window to capture immediate result of m&a announcement signal to shareholders for short run and ignored long term effects. the results even for short run are not consistent, some studies documented significant increase in abnormal returns of bidding companies after event, and others gave results consistent with hubris hypothesis. therefore need is there to scrutinize it more. as m&a is not a matter of some days, research needed to answer for long run prospects as firms are going concerns. the present study feels a big gap here to contribute for long run prospects of company followed by m&a announcement. on the other hand, developing countries including pakistan also needed to explore the results of m&a announcement, because business combinations become usual practice there as well after independence. till now only effect on profitability could get attention of researcher’s on this issue but not firm value, which needs to be performed. research objectives the present study has very clear objectives regarding m&a effect on firm value. the more straight forward words are followings: i. the study seeks to catch the effect of mergers and acquisitions on stock returns for the immediate time after the event occurred. ii. the study intends to capture the effect of mergers and acquisitions on stock price for long term after the event occurred. research significance merger and acquisitions are the very big milestones for survived firm because it takes too much resources of acquiring firm and in result it hoped with getting much benefits as well including in terms of efficiency, fulfilling management objectives and financial performance. in finance literature financial performance is more concerned in which researchers much focused on the profitability. some studies gave attention on result of firm value as well but not so much adequately. the analysis have been given on after results of m&a around the event date and not focused on long term effect on firm. on the other hand prevailing results are not consistent but contradictory. the present study will try to shed light on it by covering both short and long term analysis. particularly in pakistan there is no research study available, in my best knowledge, which could help to managers, investors and other stakeholders in decision making about m&a and firm value relationship. the present study intends to give such information particularly for pakistani scenario using kse listed companies sample. delimitations of study the current study is focusing on financial firms only, as most of mergers and acquisitions are occurred in this sector, listed at karachi stock exchange, because it is the major stock exchange of pakistan and contains majority of firms listed there. the other two stock exchanges listed firms are ignored in this study. the results will only generalize able to financial sector firms of pakistan. south asian review of business and administrative studies vol. 2, no. 2, june 2020 133 literature review with the emergence of mergers and acquisitions, the research also gave attention to this phenomenon and gauges the effects on different aspects of firm. finance literature is more concerned with financial performance of firm affected by business combinations. two traditional approaches are there to test the effect of consolidation in context of financial performance. first uses the accounting data of individual firms to capture the results on revenue, costs and profits. the approach is fairly straight forward which directly measures the performance around the event with pre and post data which is easily available and well understood. but this approach is not accurate in economic sense because data used is based on historical figures which more likely ignore the current market value. other drawback is that, changes in results could be due to other factors also than only of m&a. second approach to seek the result of m&a is to capture the stock market reaction which highlights true benefits and real economic effect due to consolidation announcement pilloff & santomero (1996). the study intends to seek similar effect which depicts investor perception about announcement and shed light on real economic benefit realized due to the event and not just of accounting figures changes. the analysis has been performed on both short and long run effect in past, following is detail given: short run event studies studies done on the m&a effect are many in numbers with focused on short run and immediate effect it creates to firm value around the event. measuring abnormal returns for before and after the event is most common method to check the significant differences. fama, fisher, jensen and roll (1969) were first to use it by calculating abnormal returns. according to fama (1970), stock prices in market reflect available information, therefore new stock price will be adjusted to up or down accordingly to new information. as capital markets are assumed to be efficient, event study method show true change in share price emerged from m&a announcement. other benefit associated with using event study methodology to capture the effect of m&a on share price is of information effect. announcement of m&a produces a signal which goes to investors and informs them about an event having potential to affect share price. drawbacks related with event studies while measuring effect of consolidation on firm value, first can be of different models. allen and sirmans (1987) measured abnormal returns by mean adjusted returns, dennis and mcconnell (1986) used the market adjusted returns, eckbo (1983) and dodd & ruback (1977) used market model and asquith & kim (1982) went to capm based method. these different models sometimes make comparison of results impossible. other drawback contain is of different event window used by different authors. franks and harris (1989) used event period as four month before to one month after the event occurred, likewise some used one week announcement effect and others took days as two days, five days or 12 days around the event to measure abnormal returns. in this instance there is no standard time which could be used reliably. empirical evidence on event studies there are many studies on event studies related with the effect of m&a on share price. some studies documented positive abnormal returns for the acquiring firms after the combination and others have opponent view of event regarding value effect with negative returns. here are some studies describing this phenomenon. mandelker (1974) the study took a sample of companies mergers listed at new york stock exchange for the period of november 1941 august 1962 to scrutinize the returns affected by mergers to owners. study used market adjusted model and showed the cumulative abnormal returns of 0.037% for the 40 months after and before the event for acquiring firm and did not gave car for the acquired firms. south asian review of business and administrative studies vol. 2, no. 2, june 2020 134 dodd (1976) this study took the sample of 242 firms of australia and examined the share price around takeover offer. findings of the study were that shareholders gained abnormal returns before announcement date because of good performance and surplus funds which could be maximized in a takeover bid. but shareholders suffered significant losses after the takeover announcement. the cumulative abnormal returns (car) for the shareholders were up to -10.9% over the 24months after event date. whereas the abnormal returns of acquired firm increased significantly even car went to 25% after public announcement. the news was good for acquired firm and they expected high compensation for their firm at the expense of acquiring firm. the weakness of this study was that it took 24 months before and after around the announcement made. the effect on share price documented therefore could be biased, because economic factors can influence these share price movements as well, which are less relevant in gauging the true effect of these m&a. dodd and ruback (1977) the study took sample of companies listed at new york stock exchange from 1958 to 1975. they document similar results with earlier event studies conducted on subject matter. consolidation shown positive abnormal returns as 11.6% for pre 12 months but depicted reduced 2.83% returns for post 1 month of that event announcement with even having negative cumulative abnormal returns as -1.32%. their study tried to capture long run perspective and showed car for 5 years (60 months) as -4.59%. apparently results seen consistent with hubris hypothesis but these car for much long period could have resulted due to another market wide or economic wide factors. langetieg (1978) the author uses three factor performance index based on jensen's performance index (1969) and mandelker’s model (1974), documented significant differences with results of two different methods employed. 149 mergers and acquisitions of nyse listed companies showed positive returns for the acquired and and negative returns for the acquiring companies around the event occurred. returns for both target and bidding firms were negative when authors prolonged the time span to 70months after the m&a announcement. dennis and mcconnell (1986) by using the mean adjusted returns and market adjusted returns, the study measured the flow of returns for corporate mergers occurred during 1962-1980 of us firms. the strength of study was that it tried to isolate effects on shareholders wealth other than m&a by taking 20 days for before and after the event. and showed the very clear positive abnormal returns for targets firms and found no evidence that showed shareholders of acquiring firm loses, instead in some cases they found positive abnormal returns as well. the results here are mixed and are inconsistent with other documented results in the era. allen and sirmans (1987) to capture share price reaction to the announcement made for mergers, authors used mean adjusted returns for measuring abnormal results of acquiring companies. the cases of u.s mergers occurred during 1977 to 1983 were focused and documented similar results with dennis and mcconnell (1986) and inconsistent with others that of conducted for same period such as with mandelker (1974) and dodd (1976). this study also focused short period around the date of announcement but bit larger than dennis and mcconnell (1986), 40 days for before and after instead of 20 days. the results showed 1.34% abnormal return for the first day and 10.34% car for second day for acquiring firms raising a question mark on earlier results, therefore made space to clear the true effect. south asian review of business and administrative studies vol. 2, no. 2, june 2020 135 bradley, desai and kim (1988) authors of this study enlarged the sample to 921 from nyse and american stock exchange listed firm’s mergers and increased the time span over the period from 1963 to 1984. they employed market model to measure abnormal returns for both acquiring and acquired firms. they showed car of acquiring firms as 31.28% for period commencing from 20 days before the announcement date to 80 days after the event occurred. the car for acquiring firms was showed very low to 1.62% but positive for same time period. franks and harris (1989) this study took sample from different market, u.k 1800 corporate mergers, for the period of 1955 to 1985. for the announcement month study finds 23.3% abnormal returns for the acquired firm whereas only 1% found for acquiring firms. these returns increased to 29.7% and 7.9% for target and bidding firms respectively when period is taken 4 months before till 1 month after the date. other studies conducted on the mergers and acquisition effect by event studies are shown in following table. table 1: more evidences on event studies. study sample details event window main findings firth (1980) they took sample of 642 takeovers of uk from 1969 to 1975. month of announcement. −0.045 average cumulated residuals for the month of announcement (statistical significances are not reported). dodd (1980) they took sample of 151 takeovers of us from 1970 to 1977. 40 days before and after of event. bidders earn −0.23% (insignificant) at the announcement date from completed bids bradley et al. (1983) they took sample of 241 successful targets and bidders from 1962 to 1980, 94 us unsuccessful bidders 20 days before and after of event. on average, unsuccessful bidders gain 2.32% for -20 to +1 day , but lose −2.96% as soon as the bid failure is revealed (+2 to +20 days). both statistically significant lang et al. (1989) they took sample of 87 targets and bidders from successful tender offers of u.s of 1968 to1986. 5 days before and after of event. negative impact on bidder’s returns when the bid is made by a low tobin’s q firm lang et al. (1991) they took sample of 87 targets and bidders from successful tender offers of u.s of 1968 to1986. 5 days before and after of event negative abnormal returns were ranging from −6% to −7% from single, opposed bids (significant). smith & kim (1994) they took sample of 177 targets and bidders us from 1980 to1986. 5 days before and after the bid. bidders lose from −0.23% to −1 to 0 days (significant). holl & kyriazis (1997) they took sample of 178 successful bids of uk from 1979 to 1989. from 0 to +2 months. negative abnormal returns of −1.25% to bidders two months after the bid announcement (significant) south asian review of business and administrative studies vol. 2, no. 2, june 2020 136 higson & elliot (1998) they took sample of 1660 acquirers and targets of uk from 1975 to 1990. from 0 to +3 months. insignificant gains between announcements until completion. walker (2000) they took sample of 278 acquisitions, 230 mergers, 48 tender offers of us from 1980 to 1996. 2 days before and after the event. market adjusted abnormal returns were negative of −0.84% (significant). sudarsanam & mahate (2003) they took sample of 519 listed acquirers of uk from 1983 to 1995. 1 day before and after the event. abnormal returns of bidders between −1.39%, and −1.47%, using a variety of benchmarks. gupta & misra (2004) they took sample of 285 mergers and acquisitions of us from 1980 to 1998. 10 day before and after the event. bidders lose a significant 1.57% over the −1 to 0 day period. returns for the −10 to −2 days or +1 to +10 days are insignificant. the returns are calculated from a market model, based on an equally weighted market index. song and walking (2004) they took sample of 5726 mergers and acquisitions of us from -1 day before and day of event acquiring firms with a period of more than a year of ‘dormant’ bid activity receive a positive abnormal return of about 1%. acquirers with a ‘dormant’ period of less than a year earn insignificant returns. campa & hernando (2004) they took sample of 262 european mergers and acquisitions from 1998 to 2000. 30 day before and after the event. regulated eu acquirers lose −1.96% over 60 days around the bid announcement. bidders from unregulated industries do not earn significant returns for the same period. ben-amar & andre (2006) they took sample of mergers and acquisitions by 138 canadian firms from 1998 to 2000. 1 day before and after the event. acquiring firms earn 1.6% over 3 days. returns are calculated using the market model. above evidences raises a question on results. many studies gave consistent results with hubris hypothesis that acquiring companies suffer losses in terms of shareholders wealth against negative market reaction. but many of them had a weak point there of event window. much of studies took 4 to 5 years as event window (time period before and after the event occurred), which in turn can mislead the results. large time span around the announcement date could have factors other than m&a affecting the stock returns such as economic or some market wide factors. on the other hand some studies documented that acquiring companies also earned positive abnormal returns, more of them were using short event window around the date. this study, therefore, to avoid these misleading results, designs the research in a way that both, long and short run analysis depict their true picture and stakeholder can get a clearer picture of the south asian review of business and administrative studies vol. 2, no. 2, june 2020 137 event in terms to effect on shareholders return. short run analysis employs market model, whereas long run analysis employs ohlson (1995) model to scrutinize the effect of m&a on firm value. we have done much discussion on former, now further discussion is underlying the later in literature review. long run analysis analysis of the word “value relevance” depicts that information which affects the value of firm. accounting, macroeconomic and non financial variables are those major factors which used much in the literature to gauge the relationship with firm value. some studies focused on the impact of hedging on firm value in the developed markets as well. gordon and modigliani & miller (1958) also introduced their models which focused on dividend and firm real assets as determinants of firm value respectively. in this instance, ohlson (1995) model for share price determination is much famous in these days. it uses the book value per share and earnings per share to determine the market value per share. many researchers contributed a lot in literature of value relevance but effects other than firm fundamental variables and macro economic variables could not being focused in past. they usually focused on affect of business combinations on profitability or other performances only, whereas the m&a effect has been analyzed only at short run period, and studies which tried to focused on long run analysis of this phenomenon have failed to give a clear picture because the results were not pure (other effects could not been isolated because of longer event windows). the present study introduces a dummy variable in this model to capture the long run effect of m&a on share price so that gauges the effect of mergers and acquisition on firm value. particularly in pakistan (developing country) situation is bit a different because no study found in there which examines the m&a affect on firm value, therefore indicating gap which need to be fulfilled. this study is seeking the impact of m&a on firm value in the financial sector companies of pakistan listed at karachi stock exchange because most of business combinations cases are there. the short run analysis employs the market adjusted model which measures the abnormal returns around the m&a announcement date. the long run analysis employs ohlson (1995) model with an introduction of dummy variable to see the impact on firm value. the model is depicted below in figure: figure-1: theoretical framework for long run analysis research methodology this section involves discussion upon type of the study, sampling of the study, data collection, and data analysis technique employed by the study for both (short and long run) analysis. type of the study figure 1: ohlson (1995) firm value book value earnings south asian review of business and administrative studies vol. 2, no. 2, june 2020 138 the study collected secondary data for theory testing therefore the nature of the study is explanatory and is quantitative in type. the study does contribute in literature of firm value and is conducted for the academic purposes, therefore it is a pure research not applied. sample of the study the population of the study is all the mergers and acquisition of financial sector firms listed at karachi stock exchange, pakistan. the financial sector has been choosing because most of mergers and acquisition found of kse listed companies were from financial sector of pakistan. m&a cases list is obtained from kse website. the author intended to focus on all the m&a but due to data availability issue some criteria has been developed to get sample for the study. the study took separate analysis for the immediate and long run effect of m&a on firm value, therefore the change in modeling for both of analysis arises need of two samples because of incorporating different variables for the two separate models. the first criterion for the short run analysis sample is that data for the market price of stock of firms must be available around the merger date (event window). the second criteria is that survived firm after m&a must not merge again with some other firm because in that case the data of market prices of that very firm is vanished from kse website therefore later case of m&a is considered for the study. for long run analysis the study employed ohlson (1995) model which uses the earnings and book value to determine the market value. we took 3 years before and after the merger date so all the cases of m&a which were having the data of share price, book value and earnings for these 6 years has been selected for sample of long run analysis. for short run analysis 12 cases out of 28 m&a of financial sector firms were selected and 7 cases qualified for the long run analysis because most of survived firms through m&a itself merged with some others and data for former case is not found. data collection data collection for the analysis contains secondary data as it is explanatory study in its nature. data for the share price and daily 100 index points is obtained from kse website. whereas the data for earnings and book value is obtained from financial statement analysis (2007-2011), issued by state bank of pakistan, and from annual reports of each firm. data analysis event study method discussion in literature proved that measuring returns for immediate effect due to m&a can best given by event study methodology. this study uses this method because it can directly measure the capital gain earned by shareholders resulting from any event of merger and acquisition. the event window used is 20 days before and after the event. many studies took the event window for the years but it is argued that for that long time there can be other economic and market wide factors which could affect the returns. sugiarto (2000) used t=10 around the event to be specific to gauge the true effect of mergers on share price. the study conducted in pakistan where many studies have proven weak form of market efficiency is prevailing. therefore to cover the leakage of information we extended the event window to 20 days. the study employs the market model developed by fama (1976). the model is very famous to measure the abnormal returns. the standard approach to measure abnormal returns by market model is to employ it for each individual firm. the equation for each firm is as follow: ar dit = r dit αi βi (r mit) (1) where αi and βi will be getting through regressing the returns with market return and the equation is as follow: south asian review of business and administrative studies vol. 2, no. 2, june 2020 139 r dit = αi + βi (r mit) + e (2) t = -20, . . . . . , + 20 days where; r dit = daily stock return in day t for firm i. αi = intercept for firm i. βi = the systematic risk of stock i (individual firm). r mit = return on market index in day t relative to the announcement of offer i e = residual term. whereas; daily stock return in day t for firm i could be getting by formula below: r dit = (pit – pit–1)/ pit-1 (3) t = -20, . . . . . , + 20 days pit = price of common stock outstanding for firm i at the day t end. pit–1 = price of common stock outstanding for firm i at the day t-1 end. market return could be getting through the formula below: r mit = (miit – miit-1)/ miit-1 (4) t = -20, . . . . . , + 20 days miit = daily market index at the end of day t. miit-1= daily market index at the end of day t-1. the cumulative abnormal return then will be calculated as follow: car i = sum of ar dit long run analysis we employ the ohlson (1995) model to capture the long run effect on share price which uses earnings and book values depicted in figure 1. the dummy is introduced for the merger and acquisition event which will have value of 0 for pre merger years and 1 for post merger years. the data sheet will be in panel form because all three variables of the model are both cross sectional and time variant. to infer results study used the panel data regression but to address the multicolinearity problem the correlation coefficients between the variables are also calculated. to choose efficient panel regression form the study employs restricted f-test and hausman test. empirical findings short run analysis market model measured abnormal return by using daily share prices and daily market index. after that t-test has been applied to abnormal returns got from market model. the aim of study is to check the hubris hypothesis whether it holds in developing economies too or not. according to that shareholders of acquiring firm (biding firm) suffers from merger or acquisition occurred. there were 12 cases for this analysis. all were from financial sector firms listed at kse in pakistan containing 4 modarba firms, 5 commercial banks, 2 investment banks and one from leasing sector. the results for all of the m&a are given in table 2. the event window is selected for twenty days before and after. the results for average abnormal return (aar) pre and post are given in table. eleven out of twelve m&a showed that aar not just reduced after the event but they even went to negative return. according to t-test, eight cases showed reduction in aar with 1% significant level, kasb bank and first fidelity leasing modarba abnormal returns are reduced after event with 5% level of significance and two cases, nib bank and modarba al-mali, showed differences in abnormal returns but these are not significant according to t-test. abnormal returns for each m&a case are given in appendix (available from author on request). average abnormal returns for shareholders of kasb bank were 0.73% before merging south asian review of business and administrative studies vol. 2, no. 2, june 2020 140 international housing finance ltd. but table showed these returns reduced to -0.45% with p-value of 0.002. shareholders of first tri star modarba had 2.08% aar in pre time period but these returns decreased to -2.16% which are statistical significant on 1%. shareholders of first paramount modarba likewise had pre aar 0.64% but this figure reduced to -1.07% with p-value of 0.000. first dawood investment bank gave 1.15% aar to their shareholders in pre merger period but table show -0.55% aar for post merger period with p-value of 0.000 which shows that results are statistically significant. aar for invest capital investment bank also decreased to 0.79% with 1% significance level. orix leasing pakistan, askari bank and allied bank mergers showed that their average abnormal returns decreased in post period to -0.22, -2.96 and -0.56% respectively, olpl abnormal returns are statistical significant at 5% and later two are at 1% level. these results are in line with hubris hypothesis of roll (1986), according to which abnormal returns reduces after the merger or acquisition announcement because usually acquiring firms offer much more to target firms than the value they possess. this study shows that hubris hypothesis also holds in developing countries. the results are consistent with the study of sugiarto (2000) which uses market model to calculate abnormal returns and applied t-test to check the significant differences in pre and post abnormal returns. the present study also calculated cumulative abnormal returns for each of merger & acquisition case which shows cumulative returns for the shareholders. table 2: average abnormal returns for each firm s/r. bidding firm aar* pre aar* post t-value p-value 1 nib bank 0.37 % 0.34 % 0.04 0.486 2 kasb bank ltd. 0.73 -0.45 3.14 0.002 3 kasb bank ltd. 1.07 -0.37 4.75 0.000 4 first tri star modarba 2.08 -2.16 4.87 0.007 5 modarba al-mali -0.14 0.07 -0.59 0.719 6 first paramount modarba 0.64 -1.07 5.12 0.000 7 1st fidelity leasing modarba 0.54 -0.07 1.81 0.039 8 first dawood investment bank 1.15 -0.55 5.27 0.000 9 invest capital investment bank 0.59 -0.79 3.68 0.000 10 askari bank ltd. 1.30 -2.96 3.36 0.000 11 orix leasing pakistan ltd. 0.66 0.04 2.22 0.016 12 allied bank ltd. 0.97 -0.56 3.66 0.000 *arr = average abnormal return, ar (average returns) for each case in pre and post are given in appendix (available from author on request). south asian review of business and administrative studies vol. 2, no. 2, june 2020 141 table 3: cumulative abnormal return for each firm s/r. bidding firm car* pre car* post 1 nib bank 7.86% 7.17% 2 kasb bank ltd. 14.7 -9.02 3 kasb bank ltd. 21.53 -7.55 4 first tri star modarba 41.68 -43.24 5 modarba al-mali -2.83 1.59 6 first paramount modarba 12.87 -21.45 7 1st fidelity leasing modarba 10.89 -1.41 8 first dawood investment bank 23.14 -11.05 9 invest capital investment bank 11.99 -15.94 10 askari bank ltd. 26.00 -59.36 11 orix leasing pakistan ltd. 13.20 -0.84 12 allied bank ltd. 19.45 -11.23 *car = cumulative abnormal return above are given the cumulative abnormal return for individual firm’s shareholders. these cars are showing the differences in abnormal returns in pre and post clearly. the positive car for pre period are showing the better position of shareholders of bidding firm and negative cars are showing decrease in wealth after the announcement of m&a. table 4: cumulative average abnormal returns for each day days aar caar -5 0.64 0.64 -4 0.78 1.42 -3 0.81 2.23 -2 0.94 3.17 -1 1.17 4.34 1 -1.28 3.06 2 -0.83 2.23 3 -0.79 1.44 4 -0.83 0.61 5 -0.82 -0.21 the above table shows the average abnormal return for shareholders of m&a in each day around the event. it is clearly depicting that there were positive average abnormal returns (aar) for pre period days. but certainly after the m&a announcement those aar reduced to negative figures. the cumulative average abnormal return also is showing the pattern of decreased returns from premerger periods to post merger period days. long run analysis this section is about long run results of mergers and acquisition on firm value. the data for model was in panel form. therefore, firstly we run the diagnostic test whether to choose the efficient panel regression among pooled ols, fixed effect and random effect. the results for diagnostic test are given in table 05 below: table 5: diagnostic tests to choose efficient panel regression estimates. diagnostic test f-statistic chi-square restricted f-test 7.86241*** hausman test 11.8318*** *** denote significance level of 1% south asian review of business and administrative studies vol. 2, no. 2, june 2020 142 restricted f-test is demonstrating fixed effect than pooled ols because cross sectional units have differences in their characteristics. the null hypothesis of f-test is that “all the differential intercepts is equals to zero” and results in above table are showing the value of f-test is significant at 1% level therefore rejecting the null hypothesis. after that hausman test also indicating that efficient estimate could be getting by fixed effect model because the chi-square value is also significant at 1% level. the null hypothesis of the hauman test is that “fixed effects estimators and random effects estimators do not differ substantially” therefore by rejecting the null hypothesis diagnostic test is depicting that fixed effect estimates are more efficient in this case. table 6: fixed effects regression results dependent variable: mvps method: lsdv time series length: 6 cross sectional units: 7 adjusted r-square: 0.76 f-statistic: 15.65 p-value: 0.000 coefficient std. error t-ratio p-value constant 0.60 0.39 1.52 0.138 bvps 0.13 0.03 3.74 0.000 eps 0.04 0.02 1.71 0.095 merger dummy -0.52 0.17 -3.06 0.004 after diagnostic test we applied the fixed effect regression model with incorporating dummy variable for the pre and post years. the dummy is given value 1 for post years and 0 for the pre years. the method applied is lsdv, the cross sectional units are seven and time series length is six (three for pre and three for post) resulting in 42 observations. the dependent variable mvps is market value per share. the cross sectional dummies were significant indicating the presence of heterogeneity effect for which we used the fixed effect. the f-statisics of 15.65 is significant at 1% level as depicted in table 05. the coefficient of book value per share is 0.13 with 1% level of significance. eps has coefficient of 0.04 but significant at 10% level. the most important thing in it is dummy variable for the merger. the dummy for merger has negative coefficient of -0.52 and is significant at 1% level. this is indicating that event of merger and acquisition significantly affects the stock prices negatively with 52%. these results are also consistent with the results we infer from short run analysis by calculating abnormal returns using market model. this demonstrates that event of m&a negatively affects the firm value either for short run or for long run time period. discussions and conclusions the most important issue in the study of merger and acquisition is about the wealth effect of shareholders regardless of the motives behind it. in past many studies tried to address that issue by using event study methodology and documented that acquiring firm’s shareholders suffers from the announcement of the m&a. all these studies were carried down in developed countries and the results cannot be inferred directly without bein investigated in developing economies. this study took sample from pakistan financial sector firm’s m&a listed at karachi stock exchange. the important contribution of this study is to measure the abnormal returns for m&a for pre and post periods. recent study of iqbal et al. (2012) showed stock prices of before and after the event and concluded differences in pre & post prices. but this difference may not be statistical significant. this study calculated abnormal returns first by using the market model given by fama south asian review of business and administrative studies vol. 2, no. 2, june 2020 143 (1976). after that 2 sample t-tests was employed to check the significant differences between two samples. the results got in this manner are of more reliable. those abnormal returns then used to calculate car cumulative abnormal returns to scrutinize the total effect of shareholder wealth. this is the first study, in author’s best knowledge, in pakistan which gives information to management of firms with such effects of m&a while decision making about the m&a, and to the investors of stock markets as well. table 02 shows the results of each individual firm for average abnormal return. according to the results eight out 12 m&a cases have decreased the average abnormal return in post period of 20 days with statistical 1% significance. the two m&a were significant with decreased abnormal returns at 5% significance level and two were not significant reduced. the results were mixed but most of m&a showed statistically significant decrease in abnormal returns. overall these results are in line with earlier theories of merger and acquisition effect on shareholder wealth. this study used the event window less than the earlier study used as to isolate the other effects which could be incorporated in results. 20 days were taken because of pakistani weak efficient markets as to cover the leakage of information which may be incorporated earlier due to having private information. another important contribution of this work is of long run analysis. earlier studies to check the long run effects enlarge their event windows to years. those results will not be of pure m&a effect on firm value (sugiarto, 2000). other economic and market wide influences may be the result of that change in stock prices and returns. this study therefore models the long run analysis separately and used the ohlson (1995) model. other valuation models have much criticism on their assumptions, as gordon, (1960) and modigiliani & miller, (1958), but this model is being considered the good model for firm value till now. the model uses the earnings per share and book value as independent variables and market value per share as dependent variable. the present study introduced the dummy variable indicting the pre and post periods of event. the results showed that all the variables are positively and significantly affecting share prices but dummy variable has coefficient of -0.52, depicting that fifty two percent variation comes in stock price due to the m&a announcement negatively. diagnostic test earlier suggested that fixed effect model should be used because of existence of heterogeneity effect in model. these results are consistent with the short run analysis of this study and also with the earlier existing theories that m&a affects the shareholder wealth of acquiring firms negatively. therefore the study concludes that announcement of mergers and acquisition affects the shareholders wealth of acquiring firm negatively in both long and short run. the results are generalize able in pakistan only because the data of stock prices only taken by the kse and other economies have some other patterns of stock prices depends upon the economic conditions of that country. but audience of developing countries can have this work in use for decision making because more or less developing economies have the similar economies. policy implications this is the first study, in author’s best knowledge, in pakistan which gives empirical evidence to effects of merger and acquisitions on firm value. management of firms with information of such effects of m&a can use it while decision making about the m&a. since takeovers does not necessarily add up to shareholder wealth therefore the decision needs much scrutinization before entering in any m&a, because the aim of firm is to increase shareholders’ wealth. on the other hand investors and other stakeholders, particularly in pakistan, may get the idea and will be known for the effect of announcement of merger and acquisition on their wealth and can act accordingly. south asian review of business and administrative studies vol. 2, no. 2, june 2020 144 area of further research this study analyses only the returns of acquiring firms (biding firm) not of target (acquired firm) due to data unavailability. there is need to explore the results for the acquired firm where merger and acquisition are not for the 100% ownership. furthermore results showed negative returns for shareholders but the reasons and other fact are still hidden. so the studies may be conducted to explore the factors behind such a pattern of share prices. references allen, p., & sirmans, c. 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(2000). corporate takeovers, strategic objectives and acquiring firm shareholder wealth. financial management, 20, 53– 66. south asian review of business and administrative studies vol. 3, no. 1, june 2021 11 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.1, june 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas the impact of financial literacy on financial behavior among investors in short term financing saba kanwal, government sadiq college women university, pakistan waseem ul hameed, universiti utara, malaysia article details abstract history revised format: may 2021 available online: june 2021 keywords financial literacy, financial behavior, short term financing this work is an assessment to encourage 'the impact of financial literacy on financial behavior among investors in short term financing. the size of sample collected is 110 investors who are usually invest in different financial institutions and investment companies. the financial literacy (independent variables) have two factors that is financial knowledge and protecting resources of and one factors of financial behavior (dependent variable) that is money management. in this research, questionnaires method was used to collect the data related to investor’s literacy and behaviors. after analyzing the results, it is suggested that financial literacy of majority of an investor is at a moderate level. many analysis techniques were used, and the results shows that financial literacy have a significant relationship on financial behavior. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: kanwalsaba313@gmail.com doi: https://doi.org/10.52461/sabas.v3i1.529 introduction financial literacy is an essential for each investor to avoid financial complications because investors are frequently challenged with a compromise condition wherever one investor must sacrifice one concentration for the sake of another security (arianti , 2018). today living in a global world that is more financially motivated relatively than more employment energetic leads to worth of life, which is, depends upon investor’s capability to accomplish financial relationships. the level of knowledge that investors achieves and reserve that is associated to financial relationships would absolutely makes life relaxed while it’s making day to day financial judgments. in this manner, financial literacy could perform a main supporter. financial literacy can also be defined as investor’s capability to make knowledgeable decisions and to take actual judgments concerning the practice and managing of money. a more complex meaning would be “skill, behavior, awareness and attitude, knowledge that is required to comprehensive financial decision-making and eventually accomplishing investors financial safety (edirisinghe, keerthipala, & amarasinghe, 2017). financial knowledge was related with higher returns in savings accounts; remarkably, part of this influence was willingness of the attributable of investor to use the self-managed online banking. https://journals.iub.edu.pk/index.php/sabas mailto:kanwalsaba313@gmail.com https://doi.org/10.52461/sabas.v3i1.529 south asian review of business and administrative studies vol. 3, no. 1, june 2021 12 however, their set of data is required more evidence on more sophisticated investments. the most informed respondents reported having more diversified funds; once again, though, this analysis was based on self-reported portfolios instead of more precise managerial records (clark, lusardi, & mitchell, 2015). consequently, to make a sound financial decision, investors must have the necessary financial knowledge, ability and confidence to apply their knowledge. it means that investors need real and perceived financial knowledge (nguyen , rózsa , belás , & belásová , 2017). to evaluate financial knowledge, most academics focus on a test that measures what investor know about financial knowledge of perceptions such as compound interest rate, the time value of money, and inflation, bonds and stocks, and the diversification of risks. this objective approach to the evaluation of financial education is commonly carried out. however, a substitute method is to evaluate the financial knowledge by using the subjective measures, such as a perception or self-evaluation of education or financial knowledge. even though objective measures have been elected by economists' in their research, while subjective measures have been applied more often to study the economics or financial behavior of different kinds, such as opinions of lifetime fulfillment, gladness and happiness, attitudes of risk and credit scores. it is therefore also important to understand perception. actual and perceived financial knowledge influences investment, retirement planning, and credit card behaviors (nguyen , rózsa , belás , & belásová , 2017). as a result, financial trust or perceived financial knowledge shows a significant part in financial decisions and the individual assessment of financial literacy. insurance is a resource of security against financial loss. it is a system of risk management, which is primarily used to hedge against the risk of potential or uncertain loss. our savings and investment plans are life insurance plans that provide investors with many ways to save money and grow it. these online investment plans help with organized and disciplined investments that ensure that investor and their family achieve the financial goals. investors protect their investment through sipc against loss or risks. the sipc is the securities investors’ protection corporation. the agency that comes to the rescue when your broker goes bankrupt is called securities investor protection corporation or sipc. it is a non-profit corporation that is created by the congress in 1970 to cover investors' losses, within certain limits. the sipc helps investors when their money is stolen in the event of bankruptcy of their brokerage business but they do not save investors from bad investments. the main objective of insurance rule is to ensure that guarantors remain financially solvent and therefore he is capable to justify their pledged promises to their policyholders (rustam & yaurita , 2018). investment credit / demographic letter, market risk and interest rate is subject to the risk (jing, brockett, & jacobson, 2015). financial behavior is that behavior with investor who are normal, investors like you and me. while standard funding, in comparison, is financing with rational people in it. normal people are not irrational. in fact, investors are mostly smart and generally 'normal'. however, sometimes investors are "typical thoughtless," influenced by cognitive errors such as retrospection and deceptive emotions, and overconfidence, such as unrealistic hope or overstated fear. the way in which an investor will have to behave is a major impression on his financial well-being. therefore, it is significant to capture suggestion of behavior within a measure of financial education/literacy. financial behavior has to do with making decisions and the process of thought, such as thinking before making a budget, saving and borrowing to make ends meet, making a purchase, paying bills on time (atkinson & messy, 2012). south asian review of business and administrative studies vol. 3, no. 1, june 2021 13 money or finance shows an essential place in the life of investors, regardless of gender, age, caste or religion, income, education. money is important for personal security as well as happiness of the family and society as a complete and hereafter skills and knowledge of management money is considered a significant life expertise in the up-to-date society, which is identified as financial literacy. financial literacy is the ownership of information and accepting of financial difficulties. in short, financial literacy means skills and knowledge of controlling of personal money (das, 2016). up to the present time though, there have been precise effort on the effect of financial literacy, financial knowledge, protecting resources money management and financial behavior in the different investors’ making decision. this study explores the impact of financial literacy on financial behavior among investors in short-term financing. here, this study is trying to determine the impact of financial knowledge on money management and examines that how investors protect their resources. the objectives of the study are as follows; 1. to explore the relationship between financial literacy and financial behavior. 2. to determine the impact of financial literacy on financial behavior. 3. to study the impact of financial literacy on financial behavior by considering only shortterm financing. the study has concentrated on the influence of financial literacy on financial behavior in shortterm financing. this study explores the factors of financial literacy and other variables. many past researches tell the impact of financial literacy on financial behavior in different terms but a very little work on investor’s protecting resources and money management. hence, this study is explained that how investors manage the money for future needs and protect their resources through different insurances. in this study, the data collected about investors through random sampling either they are invested in different banking sectors, in stock markets, financial institutions and different insurance companies. there is a lot of work available about financial literacy, and financial behavior. while there is little bit work on investor’s financial literacy, protecting resources and money management. hence, this study explores the idea of financial literacy and behavior and including few factors that affects the investors behavior and shows that how investors protect their resources through by different insurances and managing the money. this study tells the information regarding investor’s financial literacy and financial behavior in which way investors make decisions and how much they have literate to managing the money and in which manners they will behave. this study will also help in measuring either the high literate investors can made well-formed decision regarding investments than less literate investors have good making decisions about investments. literature review the second section is all about review of literature. in this chapter, i explained the effect of financial literacy on financial behavior among investors in short term financing and the financial behavior of investors in terms of short term financing that is the influence of financial literacy on financial behavior of investors in short term financing. if the investors have literate and have some knowledge about stock markets, or financing, in this case they can gain a capital, etc. if they have little knowledge about financing, then they cannot gain a capital, they might be suffering a loss in this situation. hence, financial literacy is more important to the investors in order to gain a capital. here i am discussing in this section the financial literacy and financial behavior amongst investors in short term financing in detail and i can see the impact of financial literacy on financial behavior among investors in short term financing and also realize the literacy and investor’s behavior in stock markets. south asian review of business and administrative studies vol. 3, no. 1, june 2021 14 financial literacy financial literacy is the establishment of abilities and information, which permits an investor to make effective and knowledgeable decisions with all of their financial resources. financial literacy is a set of skills in which investors make real and proficient decision with their resources and behavior in short term financing. financial literacy has been defined by many authors’ in past researches. it is conferring, the financial literacy is more for those investors which have high education and financial literacy is low for those who have little information and education about stock markets. usually with little education, investors may suffer a loss. financial education has attracted the interest of academics and politicians. it is obvious that the financial knowledge leads to financial capability, creating responsiveness for self-education or making financial education programs more expressive. whoever stock market competition offers the chance to improvement in experience and effective publicity (awais, laber, rasheed, & khursheed, 2016). financial literacy is awareness of elementary financial perceptions, such as the difference between nominal values, risk diversification, working to maximize interest, and real value. the objectives of short-term financial literacy improvement are to advance the literacy of less literate or poorly literate investors. financial literacy has attracted the attention of scientists and policy makers. at last few years, researchers have improved their determinations to conduct investigation on financial literacy and have recognized the correlation between financial literacy and financial behavior among investors (adomako & danso , 2014) an important assumption of best of researches recommends a solid confident link between financial literacy and financial education. in addition, latest experimental indication recommends a solid relationship between financial literacy on behavior and that financial literacy is a main factor of participation in an investment. (adomako & danso , 2014). for instance, the works proposes that investors by additional financial awareness are more likely to share in a wide-ranging of suggested financial performs. the academic focus of money and investment choices postulates that when income falls than investors will consume less than their income in times of high earnings to support consumption (for example, after retirement). assessing whether investor have financial knowledge is somewhat that has lately been assumed. until 10 years before, analyses providing facts about debts, assets and various additional financial variables, however they cannot deliver evidence about financial awareness and financial perceptions. throughout the previous period, i have worked with many investors to gather information in order to measure financial literacy. through these findings, i have been capable to determine that three queries can be used to explore the levels of financial knowledge, as well as to differentiate between degrees of financial literacy (lusardi , 2015). there are four principles that learned to design of these findings. the first principle was relevance: the questions are related to concepts relevant to the daily financial decisions of investors throughout the life cycle. in addition, they capture general ideas rather than specific contexts. the second was simplicity: the questions measure the knowledge of the fundamental building blocks for decision making in an intertemporal environment. the third was the differentiation capacity: the questions that must differentiate the financial knowledge to allow comparisons between the investors. the fourth was brevity: the number of questions had to be kept short to ensure widespread adoption (lusardi , 2015). literacy can be promoted by investors with sufficient capitals and investors get financial information to give better results than investment decisions by using these resources. richest investors have enough more money and hence they have easily access to obtain financial information. by this evidence, they are frequently unclear about those assets that are risky because they are conscious of all evidence about the financial market. as the wealth of investors increases, and the capability to take more risk also increases because he can easily obtain all kind of information regarding financial markets or related to investments by using money, while on the spot, the less affluent investors are unsure because they cannot buy that amount of information (awais, laber, rasheed, & khursheed, 2016). south asian review of business and administrative studies vol. 3, no. 1, june 2021 15 five arrangements of common assumptions begin about this works analysis. the first denotes the low level of financial literacy, irrespective to the phase of financial growth in the country. the second discusses to the association between financial literacy and other variables. the investigators exposed a solid connection between financial literacy levels on financial behavior. the researchers provided evidences about older investors, which have more knowledge about investment than less educated investor does in financial problems. furthermore, those investors, which have less education, or those, which have low income, are not aware of financial concerns. the third assumption states the connection between the levels of financial literacy on money management. it has been verified that investors with highly literacy have more knowledge and know how to invest and managing the money in different investments for secure their future needs than investors with low literacy levels. investors with low literacy offer more information about advice from family members, friends and brokers while investors with high literacy prefer to use financial publications. the fourth states to the slits that occurs in the earlier studies, on the relationship between financial literacy on money management. in the existing research, an attempt is made to explore the correlation between financial literacy on financial behavior. the last conclusion discusses to connection between the elements that control the security judgment and the nature of investor, the size of the assortment and the security plan. different investors rely on the guidance of helpers, brokers, reports, their nature / knowledge and papers / television (kalli & al-tamimi, 2009). there is a substantial correlation between financial literacy and financial behavior because investors who have information about in what way to take advantage on capital investment from the stock premium. financial literacy is directly related to the financial behavior. the experiential consequences propose that investors with high literacy indicates a greater degree of planning (awais, laber, rasheed, & khursheed, 2016). financial literacy is very low between gender, specific qualifications, age and income. the level less financial literacy and knowledge have usually found in younger investors. financial literacy has significant penalties; those investors who have lack of literacy level will not be capable to make policies for retirement and hence they will have less money near future, so they will have less capability to invest in different investments and in shares (awais, laber, rasheed, & khursheed, 2016). in addition, financial literacy have significant concerns for debt-related judgments, and also establish suggestion that less literate investors have a habit of making high-cost transactions, suffering greater dues and using high-cost credits. those investors also have a habit of having unnecessary debt minimums and a greater possibility of default credit. it is also predictable that financial literacy simplifies the growth of capital by growing the possibility of financing in the standard marketplace and having a more differentiated assortment (edirisinghe, keerthipala, & amarasinghe, 2017). financial education can be interpreted as financial knowledge, with the aim of achieving prosperity. it can be determined that financial literacy is the aptitude of investors to know finances in general, where knowledge includes savings, investments, debts, insurance and other financial instruments (arianti , 2018). the capability to manage, analyze, read and write particular financial situations that affect physical welfare. it is also comprises the competency to distinguish financial options and deliberate financial problems without (or forecasting for the upcoming, despite discomfort replying efficiently to the occasions of life that disturb each day financial decision, including events in the over-all budget (suhud & widyastuti, 2017). there is a firm connection between day-to-day financial management skills and financial literacy, while further research has originate that those who more capable to read and calculate are more likely to contribute in markets of capital, capitalize in more actions and save money. the more south asian review of business and administrative studies vol. 3, no. 1, june 2021 16 financial know-how represents that investors are probable to plan for withdrawal and those who plan are also gathering more wealth (morgan & trinh , 2017). most of the research undertaken by different investors has identified financial literacy. there is sufficient indication that investor who have studied finance or corporate are more likely to be economically well informed, whereas undergraduate investors in business administration have more financial literacy than those who are not. this is because financial literacy is highly correlated with investors taking high-risk investments (rasoaisi & kalebe, 2015). the area of residence is also assumed to be related to the level of financial literacy, with investor living in rural areas having the lowest level of financial literacy, whereas investor who are existing in urban having highest level of financial literacy. a large body of research has established that the most financially cultured investors are more probable to successful owning mutual funds and stocks. however, none of these researches had managerial data related to financial knowledge and actual investment models (clark, lusardi, & mitchell, 2015). the extraordinary shift of financial markets above the previous period has led to a new increase in financial literacy, constructing it unknown fewer than an important instrument for survival. technical developments are a range of new investor merchandises and facilities have made up-to-date investment providers more complex. now in today's market, it is more significant than constantly that investors learn approximately their moralities and choices in terms of financial offerings (cudmore , patton , ng , & mcclure , 2016). there are two basic dimensions of financial literacy: the first dimension is understanding, which signifies particularly financial literacy or financial knowledge, which is applying that knowledge to personal financial management. while it is useful to assess investor's financial literacy, it is tough to explore in practice how investor practice financial evidence and decisions made built on that knowledge. indeed, financial literacy encompasses a numeral of ideas, with awareness and financial capacity, and before research, it is difficult to collect all this information in a sensible amount of time. over the years the research in the field of financial literacy has increased, the way it defined is inconsistent, with several authors addressing the subject differently by attributing different connotations to it. in addition, financial literacy has ambiguous use in studies, particularly to understand the variances amongst these perceptions, that is, financial literacy or literacy. in this manner, i have been capable to distinguish between these terminologies, that financial literacy includes the capability to make effective or efficient decisions and understand financial information by applying previous studies, while financial knowledge simply defined as the set of facts and figures. in other words, the key emphasis of this study is financial knowledge and financial literacy; in accumulation, it involves the position and financial behavior of investors (potrich , vieira , & kirch , 2015). academically, financial literacy is considered an investment decision that is investors making decision to invest in different financial markets and institutions. investors will invest in different financial institutions and marker in order to provide them a positive return, that is, the cost of expected return is higher than the cost of investing money. earlier researches claimed that the primary advantage of spending in financial literacy is to increase the net return on investment by making more knowledgeable financial selections. somewhere else, i can say that alternative advantage may less of a financial concern. conversely, financial literacy has been neglected as a perception of its particular from a theoretic and practical perspective. numerous researches have exposed the direct impact of financial literacy on various financial behaviors, then rare have concentrated on building financial knowledge per se (skagerlunda, lind, strömbäck, tinghög, & västfjäll, 2018). south asian review of business and administrative studies vol. 3, no. 1, june 2021 17 financial literacy is measured by following two components such as: protecting resources (including through either insurance companies or other risk management techniques) and financial knowledge. financial knowledge financial knowledge is the ownership of a set of aptitudes and awareness that permits investors to make informed and actual judgments through their all-financial means. ... investors with adequate financial learning make better manage of money and financial decisions superior than those who do not have that training. the study of financial knowledge and especially on its components such as approaches and performance has increased greatly responsiveness and lights (lajuni, bujang, karia, & yacob, 2018). financial knowledge was related with higher returns in savings accounts; remarkably, part of this influence was willingness of the attributable of investor to use the self-managed online banking. however, their set of data is required more evidence on more sophisticated investments. the most informed respondents reported having more diversified funds; once again, though, this analysis was based on self-reported portfolios instead of more precise managerial records (clark, lusardi, & mitchell, 2015). consequently, to make a sound financial decision, investors must have the necessary financial knowledge, ability and confidence to apply their knowledge. it means that investors need real and perceived financial knowledge (nguyen , rózsa , belás , & belásová , 2017). however, a substitute method is to evaluate the financial knowledge by using the subjective measures, such as a perception or self-evaluation of education or financial knowledge. even though objective measures have been elected by economists' in their research, while subjective measures have been applied more often to study the economics or financial behavior of different kinds, such as opinions of lifetime fulfillment, gladness and happiness, attitudes of risk and credit scores. previous educations specify that the level of financial knowledge in developing countries is lower than that of developed countries. although many studies have revealed that an investor with a great level of financial knowledge may not essentially have a progressive self-perception of his cognitive level or good in dealing with his financial affairs. i have decided to include financial knowledge as previous studies have shown that it can boost optimistic financial behaviors such as increased participation in financial markets, higher voluntary and better diversity increased use of formal sources of borrowing, the ability to manage credit cards wisely, timely payment of bills, an appropriate retirement plan, savings and investment (lajuni, bujang, karia, & yacob, 2018). in addition to larger abuse and fraud, the lack of financial knowledge may leads to defaulter performance, which increases the financial vulnerability (i.e., bigger losses of loan). insider investors might also apply for enhanced to improving transparency and honesty in financial institutions, innovation on the financial sector that play an important role in market monitoring. moreover, financial illiteracy seems to be predominantly simple for major population groups, least educated; and older investors and low-income ethnic minorities; (klapper, lusardi, & panos, 2013). knowledge is the development of education, personality and abilities of investors. there are three ways in which financial knowledge is studied. the first way estimates that how financial knowledge affects investor's financial education scores. the second form evaluates that the effects of financial knowledge on financial behaviors in short term financing. the third form studied the impacts of financial knowledge on different short-term financial behaviors. the financial knowledge has four approaches. the main four approaches are school-based, employer-based, south asian review of business and administrative studies vol. 3, no. 1, june 2021 18 community-based, or credit counseling, all four approaches do not have clear results related to their effectiveness (isomidinova, singh, & singh, determinants of financial literacy: a quantitative study among young students in tashkent, uzbekistan, 2017). nearly half of investors acquired their financial knowledge. these both studies have shown that financial knowledge increases financial behavior. several studies have shown that investors' behavior is influenced by their various financial knowledge. those investors who show a little literacy level are less likely to invest in equity markets and plan for retirement. financial knowledge affects financial decision-making, and those with low literacy are likely to depend on friends and family as a major supplier of financial guidance. more significantly, less literate investors are less likely to invest in equity markets (mouna & anis, 2017). investors will devote optimally in financial knowledge in order to reach higher gains on assets. investment in financial literacy is linked to investment in risky assets. in addition, they do not need a higher level of financial knowledge does not require a lot of investment in financial knowledge that produced a higher trading curve to invest in risky assets. a higher level of savings and investment in financial knowledge will increase the option of investing in risky assets and is more likely to improve welfare. financial knowledge levels will vary among different educational groups due to the different income profiles of people throughout the life cycle (ramadan, armada, & leal, 2017). protecting resources protecting resources is the second variables of financial literacy. investors protect their resources either through insurance companies or through insurance. protecting resources is that resources, in which investors protect their resources through insurance. insurance is a resource of security against financial loss. it is a system of risk management, which is primarily used to hedge against the risk of potential or uncertain loss. our savings and investment plans are life insurance plans that provide investors with many ways to save money and grow it. these online investment plans help with organized and disciplined investments that ensure that investor and their family achieve the financial goals. investors protect their investment through sipc against loss or risks. the sipc is the securities investors’ protection corporation. the agency that comes to the rescue when your broker goes bankrupt is called securities investor protection corporation or sipc. it is a non-profit corporation that is created by the congress in 1970 to cover investors' losses, within certain limits. the sipc helps investors when their money is stolen in the event of bankruptcy of their brokerage business but they do not save investors from bad investments. the main objective of insurance rule is to ensure that guarantors remain financially solvent and therefore he is capable to justify their pledged promises to their policyholders (rustam & yaurita , 2018). investment credit / demographic letter, market risk and interest rate is subject to the risk (jing, brockett, & jacobson, 2015). the impact on market investment has increased significantly and attracted with greater attention and interest. it is quiet in the initial phases of progress and now accounts for merely a lesser share of worldwide markets of the capital. although it is tough to determine a variability of causes, including the sector diversity and lack of clear definitions, cross-regional approaches, the potential of the investment market with a social impact has been considered important. this is because of south asian review of business and administrative studies vol. 3, no. 1, june 2021 19 increased interest in key institutions and investors as well as the transmission of wealth between generations (wilson, 2015). protects investors from economic losses resulting from political risks such as expropriation, currency restrictions, war, political riots and breach of contract in the country where the investment is made. the maximum duration is 20 years. i have organized devices from existing literature into categories along the two dimensions. first, i have classified devices according to phase (relative to fsi) in which works the device. i have collected these devices in previous and subsequent devices. previous ante hardware reassures the stakeholders that fsi (foreign service institute) manufactures by setting rules for the value of the appropriations before the fsi decision, while the subsequent hardware restores the stakeholders by providing a subsequent bargaining process after making a decision to make fsi reassure them that the company will not confiscate its investments unilaterally. second, i have classify the devices according to the type of uncertainty (behavioral or environmental) that is intended to reduce it. in general, i have focus on stakeholders that are likely to prepare fsi value and that are members of the company's value chain i.e., customers, suppliers and employees (hoskisson, gambeta , green , & li , 2018). international law offers little protection to foreign investors. customary international law has not limited itself to the absence of generally accepted rules 33 on this subject, but has also required a mechanism of binding for resolving the investment arguments. furthermore, in the 1970s, the developing countries have requested to the establishment for a new international economic order, while the nature of international law governing foreign investment became a serious dialectical issue. whereas those countries who are exporting their capital emphasized that international customary law, levies a duty to respect the minimum standard on the host country, because many developing countries have rejected this view of international customary law protection is dealing with foreign investors (salacuse, 2017). legal protection for investors can decrease the cost of financing by falling the use of privileged information, improving the level of corporate governance, improving the quality of information disclosure and, and formerly reducing the company is financing restrictions. protecting the credit contract will influence the interests of creditors between the companies and banks so that companies can gain additional longer-term debt maturities, lower interest rates, and bank debt financing. although law enforcement is clear, and the role of law is limited, then by improving the legal protection agencies for investors, which can decrease the cost of capital (fan, 2018). local and foreign scientists study the investment policy issues of insurance companies and their relation to the economic growth of the state. thus, analyzing the emerging dilemma in the establishment of the strategy of investment in the insurance of life that will make sure the receiving of revenue for current insurance beneficiaries through a high level of profitability, while at the same period of time, which will ensure the security of funds for a short time period to youth insurance companies. the arrangement of these limitations indications to a major deterioration to the policy of investment in the insurance company (alyakina, kaigorodova, pyrkova, mustafina, & trynchuk, 2018). financial behavior several studies in the past have tried to investigate the effect of financial literacy on financial behavior. financial behavior is the dependent variable. financial literacy/education has been shown to enable investors' participation in investments, savings and effectively managing money south asian review of business and administrative studies vol. 3, no. 1, june 2021 20 through a limited budget and freeing themselves from debt (edirisinghe, keerthipala, & amarasinghe, 2017). it can also be defined as an investor’s behavior, which is related to money management. common financial behaviors include credit, cash and savings behavior. an investor who wants to learn financial behavior must understand the psychological, sociological and financial aspects (arianti , 2018). sociologists recognized the effectiveness of predicting financial and economic processes based on how we understand the attitudes. studying the financial behavior of investors is therefore an important and important research subject to scrutiny from various perspectives as young investors face critical dilemmas and must deal with complex financial decisions at every stage of their life cycle (lajuni, bujang, karia, & yacob, 2018). earlier research has targeted at founding the relation between financial education/literacy on financial behaviors have formed numerous results. the absence of financial knowledge has been related with behaviors, which is directed to financial errors, such as overprints, mortgages with high interest rates and inadequate savings and investment. lack of financial knowledge affects the daily routine management of funds as well as the capability to protect money in the short-term financing. for instance, financial knowledge has been related with positive financial behaviors, such as paying bills on time, having a checking account, and having an emergency fund, keeping track of expenses, and having a savings account. in comparison, some past researchers cannot find a relation between financial education/literacy on financial behaviors, the control of emotional behaviors declines the perceived affiliation between financial education/literacy on financial behavior (henager & cude, 2016). the way in which an investor will have to behave is a major impression on his financial wellbeing. therefore, it is significant to capture suggestion of behavior within a measure of financial education/literacy. financial behavior has to do with making decisions and the process of thought, such as thinking before making a budget, saving and borrowing to make ends meet, making a purchase, paying bills on time (atkinson & messy, 2012). financial behavior is that behavior with investor who are normal, investors like you and me. while standard funding, in comparison, is financing with rational people in it. normal people are not irrational. in fact, investors are mostly smart and generally 'normal'. but sometimes investors are "typical thoughtless," influenced by cognitive errors such as retrospection and deceptive emotions, and overconfidence, such as unrealistic hope or overstated fear. the normal financing is based on four substance blocks: the first block states that investors are sensible. the second block states that the marketplaces are well organized. the third block defines that investors should design assortments according to the procedures of the medium-variance portfolio theory and do so. the last block states that the expected returns on investments are designated in the standard asset valuation theory, where the changes in expected returns are firm only by the changes in risks. financial behavior suggested a different base block for each of the standard financing base blocks. according to financial behavior, the standard financing base blocks discusses the natural investor; marketplaces are not effective, even if it is tough to overcome. an investors design assortment according to the procedures of behavioral portfolio theory. the expected return on investment is described by the behavioral theory of asset pricing, where the differences in the expected returns are measured by other than the differences in risk. behavioral portfolio theory is described as risk-taker investors who prefer vouchers of lottery to expanded assortments if they have high goals because behavioral investors are reluctant to yield (statman, 2014). south asian review of business and administrative studies vol. 3, no. 1, june 2021 21 money management the management of money is the procedure of investing, spending, saving, or monitoring, and budgeting the use of the capital of a single, or collection of groups. ... the management of money can also be defined as "investment management" and "portfolio management”. money transfer situation, social acceptability, security, failure, moral evil, socially unacceptable, whereas those investors that have money are comfort, strength, security and freedom. the attitude toward money was related to status, anxiety, power and mistrust. they identified three major psychological aspects of attitudes towards money. the first aspect defined the security, confidence and optimism of money, pessimism, anxiety and the fear of not having enough. the second psychological aspect defined the desire to conserve money and hoarder behavior. the third dimension included the status, power and prestige association of money. these factors helped to understand investors' positive and negative attitudes towards money and its symbolic meaning. the strength factor was significantly associated with the condition and the time-keeping factor was associated with the obsessive personality. the confidence factor was associated with paranoid personality. these measures were able to capture the obsessive thoughts, anxieties, fears and negative feelings of investors about money (khare , 2016). the management of funds can be seen as a combination of the efficiency of investors in understanding, analyzing, addressing and communicating investors' issues towards their financial well-being. budgeting, spending, savings, investment and absence can have adverse effects on investors' wealth. in this context, wealth includes savings accounts, employer-backed retirement arrangements, insurance policies, real estate, and other monetary assets. financial literacy and appropriate money management can therefore have worthwhile results on financial performance: investors with low-income education are fewer likely to raise capital and promote capital efficiently. the short-term effect of money management is often to raise the level of investment in wealth for the future, especially for retirement, and thus is closely linked to pension and pension assets (sundarasen & rahman, 2017). ement independent variables dependent variables by following the conceptual framework, five hypotheses are proposed; h1: there is a positive relationship between financial literacy on financial behavior h2: there is significance relationship between financial literacy on financial behavior h3: there is a positive relationship between financial knowledge on financial behavior h4: there is a positive relationship between financial literacy on money management h5: there is a positive relationship between protecting resources on financial behavior methodology the third chapter define the methodology that is used to achieve the study objectives. this chapter also describes the research design, linear regression model. it also covers the target population, sample size, data collection method and measurement of variables and techniques. financial literacy 1-financial knoweldge 2-protecting resources financial behavior money management south asian review of business and administrative studies vol. 3, no. 1, june 2021 22 to extent the numerous purposes of the study quantitative research method was employed. this study monitored deductive research approach, which is created on the primary collected data through a survey of the questionnaire. through discussing to the literature related to financial literacy two dimensions (financial knowledge and protecting resources) were designated to measure both level of financial literacy and nature of financial behavior (money management) (edirisinghe, keerthipala, & amarasinghe, 2017). the unusual method of questionnaire allows accordingly evaluating the financial literacy and financial behavior of investors belonging to different ménages, social classes, professions, levels and fields of education. in this manner, it is possible to build up historical data at the domestic level and accrue intergenerational information among domestic investors that may be used for more than apprehension (loutfi & murr, 2018). research design this research is based on the cause-and-effect among investors of financial literacy on financial behavior in short-term financing. this design pursues to explain the casual relationship between variables. unit of analysis the investigators to examine the variables manipulating financial literacy have used numerous analysis elements. hence, the current research is aimed to explore the impact of financial literacy on financial behavior among investors in short-term financing. moreover, to study the significance and importance of cooperation and to classify the determinant variables of financial literacy and financial behaviors. target population the target population is investors. the target of population in this research covered investors, which invest in different investments. sampling design and sample size the method of survey that is applied to the collection of data by using a technique of questionnaire. due to time limitations, the size of sample for this survey method was set at 110 defendants. the non-probability suitability sampling was applied, and this is involves in selecting the random sampling units that are the fastest and easiest way to achieve for the sampling of the research. the main purpose was to identify the relationship between variables, primary data was composed through questionnaires, as there is no secondary data available (isomidinova & kartar singh, 2017). the formula used to determine the size of sample, was presented by green (1991), that is 50+8k, where k denotes the numbers of independent variables. instrumentation of data collection the questionnaire was used to accumulate effectively all data that was analyzed by computer. there were two sections in the questionnaire. in section a, four demographic variables are included. part ii covers questions about independent and dependent variables. questions were adapted and adopted from previous research. some questions have been taken from previous research and some from the organization for economic co-operation and development (oecd). respondents to fixed alternative questions are asked to choose the best answer based on a likert scale of five points (isomidinova & kartar singh, 2017). data type in the data type, the quantitative approach is used and the questionnaire that includes many questions are linked together since the important key of the study is to measure that whether the relationship between the variables exists or not? if so, how relevant is their correlation and what is the statistical links between these variables? (lodhi, 2014). south asian review of business and administrative studies vol. 3, no. 1, june 2021 23 the data analysis the process of data analysis is used to testing, checking, modeling, clearing, and converting the data in order to inform conclusions, support decision-making, and discover useful information. in the step of data analysis, the collected data are analyzed statistically to understand if the hypothesis that were created have been sustained. to categorize the level of financial literacy of investors from the survey, i am used cluster analysis. with the objective to determine whether investors' financial literacy levels differ regarding demographic characteristics i have apply chi-square test. i am studying the influence of financial literacy of investors on the principal of component financial behavior factor analysis. i am also examined that whether the loan respondent behavior differs in financial literacy levels and demographic variables. reliability and validity validity is the capability to measure the concept, idea or perception with correctness (sekaran, 2003). the degree to measure the concept whether it is right or wrong and their reliability with strength and the measurement of consistency are concerned with validity. the measurement of the reliability is the suggestion of the consistency and stability through which the concept is measured by instrument that supports to measure the quantity of the goodness (sekaran, 2003).the reliability of the research is acceptable by the heterogeneity of the population and adequate size of sample that is actually selected and observance in opinion with other environmental variables too (lodhi, 2014). the reliability means that there is a trustworthiness of the data collection and it is verified to check the data reliability. the alpha coefficients are the greatest method to evaluate the reliability and consistency of the variables and find out the relationship between the variables. the alpha has ranges 0.7-0.8 means that there is a chance for acceptance and 0.9 means that this is excellent. the correlation analysis the chief purpose of the correlation analysis is to check the relationship among variables. it is moreover used to find out the direction of the variables, whether the direction of the variables is related or unrelated. the correlation analysis is different from the regression analysis in a way that it does not reflect the contributory relationship for the variables in study. the value of correlation analysis ranging from +1.00 to -1.00. the -1.00 means that the relation among variables is perfectly negative, whereas +1.00 means that there is a perfectly positive relation among variables, while 0 value represents there is no relationship among variables. the regression analysis the main objective of regression analysis is to find out the effect of one variable to the other variables. it is commonly used to forecast and estimates the association between variables. it is used to estimates the dependency of one variable to the other variables. the correlation analysis designates the strengths of x variables on y variable, while regression analysis tells the prediction of y variable with the x variable. data screening data screening is necessary to make sure that the collected data during the survey questionnaires is enough good to pass through different analyses and tests to answer those hypotheses that is generated in section three. the data screening will have gone through numerous tests: multicollinearity analysis the multicollinearity analysis is applied to check the strength of correlation between variables in the regression analysis. there are two main factors that affect the correlation between variables that vif and t. vif is the variance inflation factor, and the reciprocal of tolerance. if the value of vif close to zero then there is no correlation exists between variables, when the value of vif south asian review of business and administrative studies vol. 3, no. 1, june 2021 24 is greater than zero there is correlation exists between variables. however, the value of vif is greater than 5.0 than there is a strong correlation exists between variables. the second factor that is, tolerance if the value close to zero then there is a multicollinearity exist. when the value close to 1 then it will show that there is less multicollinearity among variables. missing value analysis sekaran (2003) suggested that is used to attribution techniques the cell to subtitute/replaced which will be gone unfilled. conferring to this technique the value of mean will be substitute with the value of missing which is found in certain particular cells. normality analysis the normality analysis is done by applying descriptive statistics to check the value of skewness and kurtosis. the value of skewness lies between +1.00 to -1.00, while the value of kurtosis lies between +3.00 to -3.00. if the values of collected data lies between these +3 to -3 and +1 to -1, then it is said that the data is normally distributed. the use of statistical technique the statistical technique is used to find out the relationship among variables, then the software spss (statistical package for social science) is used. spss is a records managing and the program of study is calculated to do statistical data analysis, which is include the statistics of the descriptive study such as strategies, rates, graphs, and slopes, as well as cultured inferential and multi-variation statistical processes like factor analysis, categorical data analysis, the analysis of cluster, and the analysis of variance (anova). it is also designed to estimate and test structural equation models. this statistical technique is involved by correlation and regression. to check the influence of some variable to the other variable, regression model has been applied while to know the association of independent variables and dependent variables, the correlation has been performed that facilitated us to extent to forecast the eventual reason and result relative amongst variables. quantitative research method the study analysis of quantitative method is the greatest method to confirm the results and accept or reject the assumption. the measures for periods have not been reformed, and consequently a standard is measured in various areas of social sciences and disciplines. it is used to measure variables. analysis and findings data screening this section is about long run results of mergers and acquisition on firm value. the data for model was in panel form. therefore, firstly we run the diagnostic test whether to choose the efficient panel regression among pooled ols, fixed effect and random effect. the results for diagnostic test are given in table 05 below: missing value analysis sekaran (2003) suggested that is used to attribution techniques the cell to subtitute which will be gone unfilled. according to this analysis, there is no missing value. error analysis error analysis is described by using frequencies and descriptive techniques. when i have been tested the error analysis, then there is no error found. 4.2 preliminary test south asian review of business and administrative studies vol. 3, no. 1, june 2021 25 the preliminary analysis is done through different test. which are as follows: validity and reliability test, normality test, and multicollinearity test. 4.2.1 validity and reliability test according to the validity and reliability analysis, an overall value of cronbach’s alpha is 0.913 as shown in table 4.2, which is above the acceptance range of 0.7, which shows that data are more reliable and excellent. in this research, to measure the financial literacy and other variables high reliability value for the items was used. table 4.2 reliability statistics reliability statistics cronbach’s alpha 0.913 no. of items 37 normality test normality test was done by using kurtosis and skewness. if the range of kurtosis lies within -3.00 to +3.00 and skewness lies within -1.00 to +1.00 correspondingly then the data is said to be a normal. by applying the normality test, it is concluding that the data are normally distributed which is shown in table 4.3. table 4.3 normality test descriptive statistics n skewness kurtosis statistics statistics std.error statistics std.error tofl 110 .417 .230 .443 .457 topr 110 -.203 .230 -.438 .457 tofk 110 .303 .230 .556 .457 tofb 110 -.303 .230 -.624 .457 valid n (list wise) 110 multicollinearity test the multicollinearity test is shown in table 4.4. table 4.4 multicollinearity diagnostics independent variables collinearity statistics tolerance vif tofl .875 1.143 topr .614 1.630 tofk .621 1.610 the outcomes of this diagnostics show that there is no collinearity exist hence the data are free from the multicollinearity analysis. south asian review of business and administrative studies vol. 3, no. 1, june 2021 26 inferential analysis inferential analysis will go through different tests that is correlation analysis and regression analysis, which are as follows: correlation analysis in correlation analysis, i have checked the relationship among variables either they are positive or negative relation or there is no relationship between variables exists. by applying the correlation analysis, it is concluded that there is significance relationship between variables exists. table 4.5 independent and dependent variables (iv-dv) correlations tofl topr tofk tofb tofl pearson correlation 1 .325** .308** .427** sig. (2-tailed) .001 .001 .000 n 110 110 110 110 topr pearson correlation .325** 1 .604** .584** sig. (2-tailed) .001 .000 .000 n 110 110 110 110 tofk pearson correlation .308** .604** 1 .569** sig. (2-tailed) .001 .000 .000 n 110 110 110 110 tofb pearson correlation .427** .584** .569** 1 sig. (2-tailed) .000 .000 .000 n 110 110 110 110 **. correlation is significant at the 0.01 level (2-tailed). the table showed that the all three factors of ivs (independent variables) are significantly correlated to the dependent variables. the coefficients of correlation’s values are 0.325, 0.308, and 0.427. the correlation of coefficients is significant at the 0.01 level (2-tailed). regression analysis regression analysis is applied to check the impact of financial literacy on financial behavior among investors in short-term financing. the regression analysis was applied to check the impact of ivs on dvs. hence, the relationship is significance. table 4.6 model summary model summary model r r square adjusted r square std. error of the estimate change statistics r square change f change df1 df2 sig. f change 1 .678a .460 .444 .43418 .460 30.058 3 106 .000 a. predictors: (constant), tofk, tofl, topr b. dependent variable: tofb south asian review of business and administrative studies vol. 3, no. 1, june 2021 27 table 4.7 anova anova model sum of squares df mean square f sig. 1 regression 16.999 3 5.666 30.058 .000b residual 19.982 106 .189 total 36.981 109 a. dependent variable: tofb b. predictors: (constant), tofk, tofl, topr the value of r is 67.8% and r square have value of 46.0%. conclusion and findings conclusion and suggestions there are still many researchers who have a bigger interest in measuring financial literacy and their other factors. the background of the interrelated researches differs to shield the big measurement of apprehension in touch with this area. the idea of financial literacy is not clear and well defined by only one determinate factors. it is measured by many factors and it is difficult to fix limit for such an idea or concepts. to organize a concept about financial literacy power and its impact on investor’s behavior and accomplishment, the organized standard should be established. the purpose of this study is to highlight the few specific points of financial literacy. in this study, financial literacy is measured by two factors that is financial knowledge and protecting resources, while its impact on financial behavior and money management. finding the frequencies through which financial literacy involves the behavior of investors is a task for observed study. preceding results of a significance correlation between measures of financial literacy and financial behavior, it means that financial literacy increases the level of financial behavior, and also increases the level of financial knowledge and through literacy how investors protect their resources and managing the money as well. similarly, past researches have focused on financial literacy on behavior but have no focused on protecting resources and money management. hence in this research, i have focused on these factors that how investors protect their resources and managing the money as well through literacy. this study has causal relationship between financial literacy and financial behavior among investors only considering short-term financing. to understand the casual relationship between financial literacy and behavior. it is necessary to classify the factors of ivs and dvs. after analyzing the results, it is concluded that investors with high financial literacy have better ability to make strong and informed decision about investment while less ability to make wellinformed decision with low literacy. from the results, it is also assumed that old investors have more effective and efficient than younger investors because they have more experience related to investment and how to manage money for current and future needs. investors have to pursue risks in their financial judgments. investors with high financial literacy and investment experience will lead to high-risk acceptance than less experienced and literacy investors. they have greater chance to accept greater risky investments and securities. the intelligent investors learn from their past experiences to challenge risky conditions and to handle it very well. by managing investments effectively and efficiently, and with the increase level of financial knowledge and literacy investors can improve the capacity hurdles into risky investments for earns high profits. this study shows south asian review of business and administrative studies vol. 3, no. 1, june 2021 28 to be appreciated as well as it has explored the impact of financial literacy on behavior. our research proves to be valuable, as it has explored this impact as well. financial literacy have two factors that is financial knowledge and protecting resources to check the impact on financial behavior as well as money management. the outcomes of the analysis shows that financial literacy have a significance relationship between financial knowledge, protecting resources, financial behavior and money management. the value of cronbach’s alpha is 0.913, which shows that data is more reliable and excellent. . from the results, it is also concluded that investors with high literacy get information related to different financial institutions and investment companies by using the source of financial publication. while investors with low literacy level cannot easily get information that is related to investment companies and different financial institutions. they can get information through different brokers, television, family and their friends. the general objective of this research was to enhance to the literature in the arena of financial literacy by exploring the relationship between financial literacy on financial behavior among investors in short-term financing. the hypothesis which was developed during the methodology section were reinforced, high financial literacy was significantly related to the financial behavior and managing money as well. financial knowledge is the factor of financial literacy tell us that if the financial knowledge has increased in investors then they have capable to protect their resources, behave very well and also managing their money for some, future needs. recommendations the outcome of this study donates to the organization of more investigates to examine the elements playing more significant part in generating financial behavior such as money management, social environment, and social-economic status etc. following studies can recover the residents of study with some organizations so that the obtained data will be improved and dispersed more consistently. moreover, quantitative study method can be a substitute to more studies to comprehensive the quantitative data formed in this present study. from the results, it is also recommends that investors with high literacy get information related to different financial institutions and investment companies by using the source of financial publication. while investors with low literacy level cannot easily get information that is related to investment companies and different financial 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(2015). social impact of investment: building the evidence base. organisation for economic co-operation and development, 15, 3-136. south asian review of business and administrative studies vol. 3, no. 1, june 2021 32 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 145 volume and issues obtainable at center for business research and consulting, ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 4, no.2, december 2022 journal homepage: https://journals.iub.edu.pk/index.php/sabas shocks, financial soundness and currency crisis in emerging market economies nadia hassan, international islamic university, islamabad, pakistan dr. abdul jabbar, international islamic university, islamabad, pakistan dr. asad zaman, pakistan institute of development economics, islamabad, pakistan article details abstract history revised format: nov 2022 available online: dec 2022 keywords currency crisis; exchange rate; financial soundness, productivity shocks, capital controls, foreign liabilities a currency crisis is identified as a significant decline in a currency's exchange rate within a short time. every time the crisis emerges, it severely affects the economic stability and well-being of larger populations, not only for the affected country but across the world. a currency crisis is mainly initiated by weak macroeconomic conditions and speculative attacks that depreciate the domestic exchange rate. moreover, an economy's exchange rate is sensitive to a country's external and internal economic conditions; therefore, its stability is of significant concern for monetary authorities. they are compelled to switch exchange rate regimes to stabilize the currency's value. several economies have suffered from a currency crisis. however, its negative consequences are more frequent and prolonged for emerging market economies. this research analyzes the nature and mechanism of currency crises in the backdrop of shocks, financial instability, foreign liabilities, and capital controls. annual data for the period of 2000 to 2017 for a panel of 43 emerging economies is used for analysis. it is found that countries with high liabilities are more likely to experience depreciation in currencies. in this context, an overvalued exchange rate creates speculative pressure and sudden currency depreciation. the shocks to productivity and risk premium of a country also amplify the chances of depreciation. in emerging economies, capital controls do not significantly reduce the chances of a currency crisis. however, the financial soundness is likely to keep the currency value stable. effects of global shocks on the exchange rate depreciation are mixed subject to the fact that a country is a major importer or exporter of oil. the findings of this study are consistent with existing literature on emerging economies and currency crisis models. given these empirical results, it is recommended that authorities focus on managing the size of foreign liabilities, export growth, and productivity levels. monetary authorities should manage policy rates only to attract investors and must not overvalue the exchange rates and abandon the managed float to avoid speculative pressure. © 2022 the authors, under a creative commons attribution noncommercial 4.0 international license https://journals.iub.edu.pk/index.php/sabas south asian review of business and administrative studies vol. 4, no. 2, dec 2022 146 corresponding author’s email address: nadia.hassan.economist@gmail.com doi: https://doi.org/10.52461/sabas.v4i2.1546 introduction evidence of the macro-level financial turmoil across economies dates to the inception of capitalism (kindleberger, 1978; schwartz, 1987). however, these crises have been more frequently observed during the last century. some of those have been severe in nature and consequences, such as the 1960s sterling and frank crises, the collapse of the breton wood system in the 1970s, latin american economies crises, and the breakdown of the exchange rate mechanism (erm, henceforth) of european monetary system during 1990s, in late 2000s east asian economic crises and russian financial crisis and more recently in 2007-08 the global financial crisis (gfc, henceforth). the financial crisis is supposed to have several forms categorized according to two conceptual domains (antczak, 2000), narrow and broad. the narrow definition of crisis is developed on monetary grounds. it suggests that the emergence of a crisis is subject to changes in the money supply and problems in the banking sector (friedman & schwartz, 1963). the second description is relatively broad (kindleberger, 1978; minsky, 1972) and considers problems in the real sector, financial institutions' structure, exchange markets, and information flow among agents to play an active role in setting the ground for the crisis. given these explanations, a financial crisis is categorized as a balance of payments (bop, henceforth) or currency crisis, banking crisis, debt crisis, stock market crash, and liquidity crisis (djebbar, 2009). this study focuses on the first type of financial crisis, i.e., bop or currency crisis. the exchange rate is used to identify this type of crisis. the exchange rate provides a broad picture of the financial stability of an economy as it is susceptible to internal and external economic conditions, responds to domestic and foreign relationships in economic and strategic terms, and represents the overall state of fundamentals. therefore, it is sometimes argued that a currency crisis is vitally important to identify the evidence for the other types of the financial crisis (antczak, 2000). a currency crisis is defined as a significant decline in the value of a currency within a short time interval (burnside et al., 2011). the rate of decline is sometimes quantified by a threshold such as (frankel & rose, 1996) has defined the incidence of currency crisis when the nominal exchange rate declines by at least 25 percent within a month and the rate of currency devaluation is at least 10 percent greater than the previous month's depreciation. (eichengreen et al., 1995) it has attributed the currency crisis to substantial depreciation with a successful speculative attack that leads to the government's change in the exchange rate policy. for example, a crisis emerges in economies that follow exchange rate parity if authorities have shifted from the parity given a speculative attack. this creates a circular situation where speculators expect that the value of a currency will decline, and the currency will depreciate because agents have speculated it. it is argued that the exchange rate depreciates when a speculative attack occurs. for domestic currency's stability, monetary authorities either increase the interest rate or sell the foreign reserves. exchange market pressure (emp) index value defines the risk of an impending crisis. if emp has a value outside some standard deviations, three as per kaminsky & reinhart (1999) of the sample average, there is evidence of a crisis. it is important to note that the value of the emp index and the benchmark criteria vary from country to country. mailto:nadia.hassan.economist@gmail.com https://doi.org/10.52461/sabas.v4i2.1546 south asian review of business and administrative studies vol. 4, no. 2, dec 2022 147 causes of currency crisis initially, the currency crisis has been considered an outcome of weak macroeconomic conditions and government policies, remarkably following the exchange rate peg. the level of financial reserves of an economy is supposed to have a significant contribution to its growth. reserves support reducing the volatility and risk of domestic capital assets and enable the economy to defend against financial and economic crises. during deficits, it is challenging for the central bank to maintain sufficient reserves, so devaluation is inevitable (krugman, 1979). later, studies suggest that the economy may have multiple equilibria due to self-fulfilling speculations (obstfeld, 1996). in addition, speculators' herding behavior (calvo & mendoza, 1997) and the contagion effect (masson, 1998) are crucial reasons for initiating the crisis. postasian crisis, studies have observed the importance of including micro factors and macro fundamentals, particularly from the financial sector. such as problems in the balance sheet, illiquidity, and credit risk due to moral hazards that may outbreak the twin crises, i.e., banking with currency crisis (burnside et al., 2007). policy trilemma is also used as an explanation for the currency crisis. it states that free capital mobility limits governments' choice between the conduct of independent monetary policy and a managed exchange rate system. it is argued that the liberalization of capital assets and a fixed exchange rate connect the domestic interest rate to the foreign. this puts a constraint on achieving the monetary goals by conducting policy. for example, the decision for tight monetary policy requires the government to set a higher domestic rate of interest than the foreign rate. however, the free capital regime induces inflows and import demand, resulting in the decline of the domestic interest rate. glick & hutchison (2013) explained real-world currency crises such as the erm crisis, the mexican crisis, and the asian economic crisis by trilemma or impossible trinity. it has been observed that during the first of these crises, germany adopted a tight monetary policy to manage the problem of inflation and kept its interest rate higher. however, other economies could not keep up with this higher interest rate, and significant capital inflows led them to collapse. given this situation, speculative pressure forced countries to shift from the pegged exchange rate, and their interest rates and currency values dropped substantially, bringing to recession. given the evidence, it is concluded that managing the exchange rate parity is always tricky for economies over long periods because it requires withdrawing from the independent monetary policy. however, in the real world, countries are often reluctant to act passively in their monetary policy and end up paying a high cost in the form of recession. it is also argued that the crisis risk is more for the currencies that follow rigid or intermediate rates without association with a single currency (ghosh et al., 2011). in this context, economies that follow a floating exchange rate must not experience currency crises. however, (calvo & reinhart, 2002) maintains that most countries avoid the floating behavior and practice the peg with the label of floating. several researchers (chang & velasco, 2001) have argued that a currency crisis may emerge due to other crises. therefore, it is necessary to understand the mechanism and the link with those crises. problem statement economic crises in general and currency crises specifically have been distinctive attributes of international monetary setup. from the breakdown of bretton woods in the 1970s to the latin american, mexican, european, and asian currency crises and the gfc of 2008, several economies have gone through the adverse effects of crises (balakrishnan, 2009). it is observed that crisis south asian review of business and administrative studies vol. 4, no. 2, dec 2022 148 affects developed and developing economies differently, so it is necessary to understand the potential outcomes of crisis for these heterogeneous economies and suggest the appropriate economic strategy. the nature and consequences of crisis vary from country to country, given the volatility in their currencies and macroeconomic conditions. however, emerging economies are at higher risk of being affected by a financial breakdown. as for now nomura index in the following figure shows. figure 1. early warning indicator of exchange rate crisis for emerging markets. the nomura index provides early warning about the currency crisis. this index has successfully predicted the pressure on currencies in the past. currently, seven developing economies are at the top of the risk for a currency crisis, i.e., egypt, romania, sri lanka, turkey, czech, and pakistan, respectively. these economies have more than 100 scores in the early warning index damocles. this index measures the likelihood of a crisis within 12 months. if a country's score breaches 100, there is a 64% chance that it will experience an exchange rate crisis. recently, several other economies have faced similar risks but at a bit lower level. among those two countries, i.e., egypt and romania from the emerging market economies, are at the highest risk of experiencing a currency crisis. there are varying arguments regarding the economic issues and consequences of the currency crisis of a country. initially, it was supposed that the currency's depreciation was purely a monetary phenomenon that did not affect the real economy. nevertheless, kaminsky (2006) has argued that the extent of a crisis can be estimated through productivity slowdown. there is a considerable loss of output in the economy and a slowdown in growth. cross-country comparisons (basistha & teimouri, 2015; nakatani, 2018) have also shown at least a 4 percent or more reduction in the growth of economies during the currency crisis. this situation brings difficulties in implementing and making the optimal choice among the conflicting policy goals. moreover, inherent financial constraints and factors like sovereign debts, higher deficits in the current account, and low foreign reserves increase the risk of crisis in developing economies. output loss due to currency depreciation furthers the potential means of trade openness for such economies to recover from the recession. 165 145 138138 126 120 100 92 88 83 75 75 75 75 69 69 64 63 56 56 44 44 44 44 38 25 19 19 0 25 50 75 100 125 150 175 e g y p t r o m a n ia s ri l a n k a t u rk e y c ze ch p a k is ta n h u n g a ry b ra zi l c h il e in d ia p o la n d m o ro cc o k e n y a c o lo m b ia k a za k h a st a n u k ra in e v ie tn a m a rg e n ti n a p h il ip p in e s t h a il a n d k o re a s . a fr ic a c ro a ti a is ra e l c h in a b u lg a ri a in d o n e si a m e xi co p e ru r u ss ia in d e x v a lu e country threshold high risk south asian review of business and administrative studies vol. 4, no. 2, dec 2022 149 significance and contribution of the study despite extensive theoretical and empirical research on the causes and consequences of the currency crisis, it is the most frequently occurring financial turmoil in recent times that contagiously spreads across the global economy. therefore, exploring the potential measures to face such challenges is a preferred policy goal in most countries (gurtner & bruno, 2010; nakatani, 2018). due to the constant crisis risk, it is necessary to investigate the conditions and mechanisms that may collapse domestic currencies. several studies have explored the crisis mechanisms theoretically and empirically. in theoretical work, inconsistencies in economic fundamentals and policies with speculative pressure are more prominent. at the same time, the empirical focus is more on developing some system to measure the likelihood of upcoming recessions. there is very little attention given to the real and financial sector issues that lead to the breakdown of a currency (nakatani, 2018). due to structural differences among economies, currency crisis, and its risk varies across countries in terms of factors and consequences. so, it is vitally important to analyze the nature of currency crises and their effect on heterogeneous economies. besides this (candelon et al., 2014) have argued that existing empirical models are not dynamic. therefore, identifying an upcoming issue is very difficult and requires dynamic analysis by including the previous periods’ information. given these problems, it is argued that the existing theoretical and econometric methods may have prevented experts from recognizing the gfc even during the suffering (bezemer, 2009). given these issues, this study contributes to the crisis literature by addressing the abovementioned issues. the first contribution is to develop a model that identifies the nature of a looming crisis and the potential mechanisms that may bring turmoil by analyzing the structural heterogeneity among economies. this enables the developed framework to study the varying nature of a crisis. secondly, the model includes economic shocks and financial stability with macroeconomic economic indicators. this is a significant contribution as existing econometric frameworks have yet to empirically explore the role of financial stability in detail so far, particularly for currency crises. this study has also focused on analyzing the crisis framework using the dynamic probit model. that is supposed to predict upcoming crises by including information on past turmoil. another contribution of this research is to observe the potential policy for countries that may be adopted to avoid the crisis or to reduce the adverse effects and pave the way for economic wellbeing. objectives of the study this research aims to assess the role of shocks and financial stability in the economy during a currency crisis. it also evaluates the nature of a currency crisis to determine if it is fundamentals driven. the analysis is carried out for a diversified emerging economies group. given the findings, appropriate policy suggestion for emerging economies is an essential study objective. the study is organized as given. section two briefly reviews the literature on theoretical and empirical models of the currency crisis. section three discusses the empirical methodology, framework of the model, and data sources used for analysis. section four presents the result discussion. the conclusion about each hypothesis is discussed with policy implications in the next section. references to the cited works are given in the last section. literature review various episodes of turmoil across the world after the 1970s, such as currency collapse in latin american, european, and asian economies, have stimulated the considerable interest of researchers in this context. it is necessary to review existing literature from all fronts of theory and empirics to identify the risk and scale of the currency crisis in emerging economies. a substantial south asian review of business and administrative studies vol. 4, no. 2, dec 2022 150 amount of literature is devoted to analyzing the nature and dynamics of currency crises experienced in different episodes. in this section, a brief overview of theoretical and empirical models, along with recent development in literature, is presented. theoretical framework of currency crisis pre and post-crisis characteristics of economies are observed in different models categorized as model generations. these models focus on sources, signals, forecasts, consequences, and crisis measurement. theoretical models of currency crisis have three mainstream generations extended up to the fourth and fifth levels. all these models try to explain the financial turmoil experienced in different countries at different times. the ‘first-generation’ crisis models are based on the philosophy that growth in domestic credit and weak macroeconomic conditions put downward pressure on the domestic currency and force monetary authorities to quit the fixed exchange rate regime. thus, currency depreciation is unavoidable for developing countries (krugman, 1979). the crisis results from poor economic variables such as high fiscal deficits, inflation, current account deficit, trade deficit, and excessive monetary expansions (agénor, 1991; blackburn & sola, 1993; dooley, 2000). these models focus on the relationship between weak macroeconomic environments with speculations about government policies to manage the exchange rate. it is argued that inconsistencies in policy conduct lead to speculative attacks on the domestic currency. this happens because the government finances the deficit in times of high fiscal spending by reducing reserves or taking debt. however, the government can borrow only up to a specific limit, and under pegged exchange rate, it is impossible to deplete the reserves, so the deficit is financed through seigniorage. printing money brings inflation in the economy that is inconsistent with the exchange rate peg. moreover, excessive credit creation harms the reliability of monetary authorities to maintain a sufficient level of real balances, and investors start selling domestic assets to adjust their portfolios. this speculative attack further reduced the reserves, and the fixed exchange rate system collapsed (flood & garber, 1984; krugman, 1979; salant & henderson, 1978). evidence from several economies that experienced currency crises in the 1970s and late 1980s is consistent with the first-generation models. there has been a high fiscal deficit and inflation in many latin american countries, such as brazil, chile, and argentina. the rapid expansion of domestic credit to stabilize these economies led to the drain of foreign reserves and the collapse of the exchange rate peg (blackburn & sola, 1993). that is why (krugman, 1996) has referred to these models as ‘seignorage-driven,’ where crisis is predictable to a large extent. the collapse of the european exchange rate mechanism (erm) in 1992-93 highlighted the role of speculative perceptions about government policies and suggests that crisis always is not due to unfavorable economic fundamentals or expansionary public policies (eichengreen et al., 1995; obstfeld, 1996). most of the economies facing the crisis were found to have sound economic fundamentals and consistent fiscal and exchange rate policies that made it challenging to understand the reasons for the crisis from the first-generation model setting. in this context, the ‘second-generation’ studies (eichengreen et al., 1995; obstfeld, 1996) suggest that government policies are conditional to one kind of situation, and investors behave speculatively; thus, multiple equilibria emerge in the economy. krugman (1999) and esquivel & larrain (1998) have described these second-generation models as a circular process creating multiple equilibria by combining various factors like incentives, reasons, and costs, including agents’ perceptions of government to pursue parity. some studies (banerjee, 1992; calvo & south asian review of business and administrative studies vol. 4, no. 2, dec 2022 151 mendoza, 1997) have argued that agents follow herd behavior instead of individual expectations about some positive signal. it is observed that currency crisis often coexists with deteriorations in the financial sector of economies (diaz-alejandro, 1985; kaminsky & reinhart, 1999). insights from the asian crisis have given a new perspective to evaluate the crisis evolution. in this line, most studies have focused on the presence and significance of an association between devaluation and deficiencies in the banking sector. theoretical literature in this line has discussed two mainstream approaches, i.e., moral hazard (krugman, 1999) and liquidity problem (chang & velasco, 2001), that bring issues in the system of banks and financing firms and then in the exchange rate. most third-generation models have elements of previous models, such as indicators of economic fundamentals and the role of speculation to bring successful attacks with moral hazard and liquidity. some researchers (burnside et al., 2001; flood & garber, 1984) suggest developing a model setting that combines the element across previous generations. however, the absence of a sound relationship between economic conditions with crises experienced in east asia implies that it is difficult to accurately predict the crisis in the previous framework (jeanne, 1997). the prediction problem about the quick spread of crisis from one country to another has motivated researchers to consider the contagion effect. generally, contagion refers to some economic shock that diffuses from one market or economy to others (masson, 1998). these effects are due to some standard external shock, trade of financial interdependence among countries, and change in agents’ sentiment about an economy’s condition (drazen, 2000; eichengreen et al., 1995; gerlach & smets, 1995; masson, 1998; sell, 2001). in this context, trade linkages, global shocks, and competition among countries in foreign markets play an essential role. an overview of third-generation models suggests inefficient financial markets (mishkin, 1996), irregularities in the balance sheet (krugman, 1999), and weak systems of domestic banks (kaminsky & reinhart, 1999) create the basis for currency problems. the quick spread of crisis across countries is due to the contagion effect (eichengreen et al., 1998; gerlach & smets, 1995) and the herding behavior (mendoza & calvo, 1997; chari & kehoe, 2000) of investors. krugman (2001) initiated the fourth generation of theoretical models by suggesting the analysis of financial turmoil beyond currency value and emphasized considering the role of asset prices. it is argued that the poor state of financial institutes leads to inflation, over-borrowing in foreign currencies, and the conduct of conflicting public policies (breuer, 2004). bussiere & mulder (2000) have included the political factors to explain the crisis mechanism. some researchers (ghosh & ghosh, 2003) have highlighted the role of the market and other agents in creating and expanding financial uncertainty through their unanticipated actions. leading indicators in these models include the quality of the economic environment, political stability, legal and cultural rights for assets’ ownership, depositors’ trust, and credibility of financial and other public policies. these can potentially bring ambiguity among decision-makers by affecting their efficiency and information handling (agénor & aizenman, 1999; alesina et al., 2003; das et al., 2004). in brief, the fourth generation of crisis studies has explored the role of future expectations based on market price information (tularam & subramanian, 2013). it is argued to consider the role of asset prices (krugman, 2001), political factors (bussiere & mulder, 2000), standards of financial policies, the role of stakeholders (ghosh & ghosh, 2003) along with other institutional and south asian review of business and administrative studies vol. 4, no. 2, dec 2022 152 macroeconomic factors and socio-economic environment (arteta & eichengreen, 2000; breuer, 2004). empirical models of currency crisis the ongoing theoretical debate about leading indicators of crises has induced to model and forecast of the episodes of devaluation on empirical grounds. these models were initiated to test the significance and relevance of the proposed theoretical mechanisms. empirical testing is statistically developed with a focus on leading indicators. these studies endeavor to define the variables used as crisis indicators, their thresholds, and other methods to identify the risk of an upcoming turmoil. another objective of these models is to rank the countries according to the risk of developing a crisis. for this purpose, data and information is used for samples of different countries and groups. in empirical literature (derkach, 2010; kaminsky & reinhart, 1998), various approaches are proposed to evaluate the crisis, and most of these have focused on assessing the potential indicators as determinants of crisis. according to the methodology of analysis, these studies are categorized into three (chui, 2002) to four (kaminsky & reinhart, 1998) types. these are named discrete choice, signaling, and structural approaches and are classified to identify currency pressure as a crisis. the common feature of these models is using the index for exchange rate pressure as a proxy for measuring a crisis for a panel of countries that have experienced some financial turmoil. in addition to these three approaches, kaminsky & reinhart (1998) have identified another method, the qualitative approach, as it uses no formal testing of theoretical models. only graphical analysis and other factors are used to recognize a crisis. the qualitative method is based on detecting the common factors among countries that have gone through some currency crisis. for this purpose, before and after crisis patterns and the state of these economies are investigated in an exploratory manner (derkach, 2010). these models also focus on understanding how the response to some external shocks varies across countries (goldstein, 1997). however, the graphical analysis does not suffix the complicated structure of currency depreciation in a global world. since the crisis is a latent variable, there is a considerable variation in defining it by some observed variable or index. most studies have used exchange rate pressure (goldman sachs gs-watch, 1998; jp morgan;(frankel & rose, 1996) and depreciation in currency (kumar et al., 2003) to define the crisis. some (eichengreen et al., 1996) have used the average index of interest rate and reserves with the exchange rate, and others (sachs et al., 1996) have used the level of reserves with devaluation. given the data availability for relevant variables, most of the studies (gs-watch; (kumar et al., 2003; morgan, 1998; ötker & pazarbaşioǧlu, 1997)) have used monthly data, and(frankel & rose, 1996) have used annual data for various groups of countries. here, crisis indicators are selected from the theoretical literature according to some major categories. empirical models indicate the presence of a strong link between poor economic conditions with speculative pressure. in these conditions, expansionary policies, excessive credit creation, deficits, and inadequate foreign reserves (kruger et al., 2000; ötker & pazarbaşioǧlu, 1997) are supposed to intensify the crisis probability. however, it is suggested that currency devaluation is not purely a consequence of macroeconomic weaknesses or regional contagion, but investors’ behavior is also required for appropriate assessment. empirical analysis based on academic settings has also exposed several relevant factors present endogenously and exogenously in economies that initiate and boost economic collapse. these approaches can be categorized into three types, i.e., discrete choice, signaling, and structural south asian review of business and administrative studies vol. 4, no. 2, dec 2022 153 models. the precision and accuracy of these models vary subject to several methodological problems and data availability. however, a fascinating insight from the empirical literature refers to some specific indicators that are beneficial to identify a future crisis. these include exchange rate valuation, banking and financial sector inconsistencies, excessive lending, and contagion. gap in literature existing studies have conflicting evidence based on different models, as those models are primarily static and unable to provide a sufficient understanding of the dynamics of devaluation. moreover, the literature contributes to the issue of the currency crisis. it typically focuses on the factors optimal for currency areas and regimes, like the size of economies, trade openness, and macroeconomic fundamentals. little attention was paid to the implications of financial stability and the exchange rate fluctuations until the global financial crisis (gfc, henceforth) in 2007-08. therefore, it is maintained that despite the extensive investigation of the crisis, several issues and sources emerge with each episode of turmoil and must be included in the analysis of emerging economies. data and methodology currency depreciation is subject to various elements, including macroeconomic fundamentals, financial stability, capital control, external liabilities, and economic shocks. given the varying nature of fundamentals and other conditions in different countries, this analysis requires including country specific heterogeneity and preconditions. this framework is conceptualized in figure 2. figure 2. conceptual framework of currency crisis. model specification to assess the role of shocks in the exchange rate, this study uses the proposed (nakatani, 2018) modified “abb” model (aghion et al., 2000) that includes the effects of shocks for predicting the changes in the exchange rate of an economy. this model has established that the nominal exchange rate of the currency is determined from the interaction of the interest parity-lm (iplm) with the wealth or output curve. the model for the exchange rate used in this study is conceptualized in equation (1). fixed er policy er devaluation level of forex reserve gdp level of debt value of imports value of exports interest rate inflation rate weak fundamentals decline in reserves lack of confidence in currency massive speculation against currency sale of domestic currency currency collapse south asian review of business and administrative studies vol. 4, no. 2, dec 2022 154 ∆𝑒𝑖,𝑡 = 𝛽0 + 𝛽1∆𝑒𝑖,𝑡−1 + 𝛽2∆𝑖𝑖,𝑡 + 𝛽3 𝑙𝑖,𝑡 ∗ 𝐺𝐷𝑃𝑖,𝑡 + 𝛽4𝜂𝑖,𝑡 + 𝛽5𝑊𝑆ℎ𝑖,𝑡 + 𝛽6𝑊𝑆ℎ𝑖,𝑡 𝑊𝑆𝑙𝑖,𝑡 + 𝛽7𝐹𝑆𝑖,𝑡 + 𝛽8𝐺𝑆ℎ𝑡 + 𝛾𝑚 𝑍𝑖,𝑡 + 𝑣𝑖 + 𝑖,𝑡 here, ∆𝑒𝑖,𝑡 represents change in the nominal exchange rate for ith country in t time period, ∆𝑒𝑖,𝑡−1 is change in exchange rate for the previous time period, ∆𝑖𝑖,𝑡 is change in policy interest rate that represents monetary policy of country i, 𝑙𝑖,𝑡 ∗ 𝐺𝐷𝑃𝑖,𝑡 is ratio of external debt to gdp, 𝑍𝑖,𝑡 is the vector of control variables that includes gdp growth, overvaluation of exchange rate and reserves to import ratio in the country. 𝐹𝑆𝑖,𝑡 represents the financial stability that is measured by the proxy of bank credit to bank deposit ratio. 𝑣𝑖 is the fixed effect of country and 𝑖,𝑡 is error term. in addition to these, oil prices are used as a proxy of global shocks i.e., 𝐺𝑆ℎ𝑡. 𝜂𝑖,𝑡 is shock to domestic risk premium. to account for this, iplm shock is estimated from the equation (2). 𝛿𝑖,𝑡 = 𝛾1,𝑖 + 𝛾2,𝑖 𝐻𝑃𝑡𝑟𝑒𝑛𝑑𝑖,𝑡 + 𝛾3,𝑖 ϗ𝑖,𝑡 + 𝜂𝑖,𝑡 (2) here, 𝛿𝑖,𝑡 measures the risk premium for the country i in period t. it is obtained by the domestic interest rate change from the anchored currency i.e., us interest rate as: 𝛿𝑖,𝑡 = 𝑖𝑖,𝑡 − 𝑖𝑡 𝑓 . to measure the trend for the risk we use the hodrick–prescott filter and estimate 𝐻𝑃𝑡𝑟𝑒𝑛𝑑𝑡 𝑖 . ϗ𝑡 𝑖 is the set of control variables that includes the effect of monetary policy in the economy. these variables are selected to account effects of the monetary policy, government activities, and state of development in the banking sector (nakatani, 2018). the monetary policy effect is measured by differencing the domestic policy rate with us policy rate. bank assets to gdp and ratio of public sector credit to gdp is used to capture the development of banking sector and government activities respectively. 𝜂𝑖,𝑡 is the iplm shock that measures the financial market shock by a shift in the risk premium of a country is estimated as an error term of the model given in equation (2). to avoid the endogeneity problem, lag of policy rate differential is used. the productivity shock is represented by 𝑊𝑆ℎ𝑖,𝑡. it is measured by the growth in productivity of an economy. the panel study provides a deeper and more comprehensive examination of macroeconomic issues like currency depreciation. longitudinal analysis is particularly of great use for macro panel of countries as it enables to observe the country specific characteristics by controlling the heterogeneity among the cross sections over time. therefore, a group of emerging markets is selected in this study to understand the dynamic relationship of exchange rate with different variables. technique of analysis in practice, it is difficult for many economic models to establish the homogeneity of explanatory variables. similarly, the unobserved individual heterogeneity is likely to exist and correlate with both the stimulates and response variables. to deal with the problem of endogeneity, it is recommended to use the instrumental variable (iv) approach (anderson & hsiao, 1981) or the generalized method of moments (gmm) (arellano & bond, 1991) for analysis. for estimation of the exchange rate depreciation model discussed in equation (1), this research uses the gmm model to avoid the problem of endogeneity and evaluate the exchange rate dynamics for heterogenous economies. results from the panel data estimators could be more efficient if variables are non-stationary. therefore, panel unit root tests are used to ascertain whether the data series is stationary. the panel unit root equation is given as. ∆𝑥𝑖𝑡 = 𝛼𝑖 + 𝜌𝑥𝑖𝑡−1 + 𝜙𝑖 ∆𝑥𝑖𝑡 + 𝛿𝑖 𝑡 + 𝜈𝑡 + 𝑖𝑡 (5) here, the null hypothesis assumes that 𝜌 < 1 and xit series is stationary, against the alternative hypothesis that xit series is nonstationary with 𝜌 ≥ 1. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 155 data and variables the study uses the annual data of 43 emerging market economies. the data on several variables is collected from various sources for the period of 2000 to 2017 including, world development indicators (wdi) , international financial statistics (ifs) , direction of trade statistics (dots) etc. the data for currency exchange rates for policy rates is obtained from the international monetary fund (imf) data base. the time frame for panel analysis is selected as per data availability and changes in the exchange rate management policy. a brief description of the variables with the source of data is discussed here in detail. change in the exchange rate (δe): the change in exchange rate is used as dependent variable in the study of currency crisis. it is measured as the percentage change in value of domestic currency in terms of foreign currency i.e., u.s dollar. the data for change in the exchange rate is taken from ifs database. monetary policy rate (pr): the policy rate is used as the annual percentage change in the rate of interest set by the monetary authorities of the economies. data of central bank rates of selected economies is taken from ifs where available and from the official websites of the central banks of the rest of countries. foreign liabilities (l): foreign liabilities are accounted for as the ratio of external debt to gdp. these liabilities are measured as the ratio of the external debt to gdp. the data on liabilities is taken from world bank's wdi database, world economic outlook (weo) , imf, and joint external debt hub (jedh) databases. total factor productivity (tfp): the data of tfp is accessed from the penn world table (pwt), version 10.0 based on feenstra et al., (2015). export value and volume: the export level is measured in the us dollar value of annual exports and volume is the annual total exports from a country. data is taken from dots database. interest rate spread (i-i*): deposit rate is used as the nominal interest rate and is taken from the ifs. bank assets to gdp ratio is used as the control variable in computation of iplm shock. this data is taken in annual frequency from the global financial development database (gfdd), world bank. credit to public sector to gdp: the ratio of credit to public sector including government and state-owned enterprises (soes) to gdp is used as control variable in impl shock calculation. the data is obtained from the gfdd in annual frequency. real effective exchange rate (reer): data on the real effective exchange rate indices is accessed from bank of international settlements (bis) . foreign interest rate (i*): data of the foreign interest rate i.e., us rate is taken from ifs in annual series. exchange rate overvaluation (erov): the exchange rate overvaluation is calculated as the deviation of the real effective exchange rate from the five-year moving average of effective exchange rate. this series is computed in annual percentage form and is taken from bis and ifs databases. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 156 reserves to imports ratio (r/m): data on the value of imports is taken from dtos and the annual reserves over in excess of gold in a country is taken from ifs. financial soundness: two indicators are used to account for the financial soundness in an economy. these are bank credit to deposit and bank z score taken from gfdd. capital controls: the data is taken from various annual reports on exchange arrangements and exchange restrictions (eaer) by imf. global shocks: to measure the global shocks, global oil prices are taken for crude oil wti annual prices. this data is taken from international energy agency (iea) database. results and discussion this section presents the results of the estimated model of the nominal exchange rate depreciation. there is a great fluctuation in the real effective exchange rate of the economies in past decades. these fluctuations are quite high for the advance economies and other emerging economies. figure 4. fluctuations in exchange rate of emerging economies. the descriptive statistics of all variables is given as in table 1. these summaries are estimated for overall panel, between the cross-section units and within cross sections for emerging economies. table 1 descriptive statistics variable sample mean standard deviation minimum maximum nominal exchange rate overall 4.648 18.097 -28.233 293.791 between 6.438 -1.137 27.699 within 16.940 -31.174 270.740 policy rate overall -0.645 14.601 -269.743 244.350 between 1.599 -10.350 0.979 within 14.515 -268.784 245.309 iplm overall 12.409 8.539 -167.823 35.110 between 4.318 -7.626 17.299 within 7.394 -147.788 55.145 wealth shock overall 0.949 7.094 -41.723 76.469 between 1.982 -2.474 6.289 within 6.818 -41.737 76.455 gdp deviation (from trend) overall 0.198 4.338 -40.310 24.085 -5 -4 -3 -2 -1 0 1 2 3 4 1990 1995 2000 2005 2010 2015 p e rc e n ta g e c h a n g e year south asian review of business and administrative studies vol. 4, no. 2, dec 2022 157 between 0.475 -0.430 1.402 within 4.313 -39.863 24.022 exchange rate overvaluation overall 0.149 9.570 -52.162 140.585 between 1.075 -1.990 3.893 within 9.511 -55.906 136.841 reserves to import ratio overall 0.589 0.420 0.000 2.528 between 0.356 0.016 1.572 within 0.229 -0.251 1.793 financial stability overall 11.857 7.334 0.423 44.362 between 6.982 4.229 38.900 within 2.472 3.254 36.779 ratio of external debt to gdp overall 45.573 32.307 0.000 202.624 between 23.515 4.944 115.368 within 22.427 -69.795 179.122 global shocks overall 6.258 23.712 -47.659 37.687 source: author's calculations the findings of various unit root tests for the selected panel are given in table 2. these indicate that all the series are stationary at moderate level of significance i.e., 5%. table 2 results of panel unit root test variables ips llc fisher-pp nominal exchange rate -3.19*** -15.63*** 387.75*** (0.0000) (0.0000) (0.0000) (0.0000) (0.0000) (0.0000) policy rate -4.62*** -11.003*** 759.70*** (0.0000) (0.0000) (0.0000) iplm -3.23*** -4.20*** 423.54*** (0.0000) (0.0000) (0.0000) wealth shock -3.36*** -12.34*** 419.48*** (0.0000) (0.0000) (0.0000) gdp deviation (from trend) -3.06*** -8.86*** 338.67*** (0.0000) (0.0000) (0.0000) exchange rate overvaluation -3.24*** -22.25*** 404.17*** (0.0000) (0.0000) (0.0000) reserves to import ratio -22.30*** -3.70*** 249.78*** (0.0026) (0.0001) (0.0000) financial stability -4.88*** -7.45*** 133.99*** (0.0000) (0.0000) (0.0007) ratio of external debt to gdp -2.89*** -6.24*** 139.42*** (0.0019) (0.0000) (0.0002) global shock -13.53*** -6.04*** 406.81*** (0.0000) (0.0000) (0.0000) note: the level of significance is shown by narrow *(10%), moderate **(5%), and broad ***(1%) criteria. values in the parentheses represents the p-values of the test. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 158 the results from the model of the nominal exchange rate fluctuations are given in table 3. the model 1 evaluates the effect of risk premium in relation to the monetary policy and exchange rate change, model 2 estimates the impact of output shock. model 3 is the last one that includes both shocks for the economies. variables 1 2 3 lag of change in exchange rate 0.201* (0.061) 0.204 ** (0.016) 0.21** (0.018) ratio of external debt to gdp 1.62** (0.02) 2.16*** (0.003) 3.706*** (0.008) bank policy rate -0.227** (0.004) -0.348** (0.031) -0.306** (0.012) estimate of risk premium 0.198** (0.017) 0.253** (0.041) wealth shock -3.48** (0.034) -3.15*** (0.002) gdp deviation (from trend) -2.89** (0.045) 0.541* (0.078) 0.376 (0.671) overvaluation of exchange rate -0.43** (0.046) -1.18*** (0.003) -0.16** (0.039) reserves to import ratio -9.102*** (0.006) -12.34*** (0.0044) -7.12*** (0.0083) global shock 2.64 (0.192) 1.451 (0.1820) 1.487 (0.1561) financial stability -8.601** (0.064) -5.186* (0.0841) -5.508** (0.048) capital restrictions 5.14** (0.073) 3.16** (0.062) 2.28** (0.051) groups 43 32 32 observations 688 510 510 arellano-bond ar (2) test 0.115 0.242 0.186 hansen test 0.103 0.182 0.132 note: the level of significance is shown by narrow *(10%), moderate **(5%), and broad ***(1%) criteria. values in the parentheses represents the p-values of the test. to focus on the effect of monetary policy, we observe the coefficient of the monetary policy rate. this is a negative and significant variable and means that an increase in the monetary policy rate will result in currency appreciation. a one percent increase in the central bank rate increases domestic currency's value by 0.2 to 0.3 percent in emerging economies. this finding matches the expected theoretical sign of the policy rate relationship with currency value. the ratio of short-term external debt to gdp has a positive and significant relationship with the exchange rate. it means that one point change in the ratio depreciates the nominal exchange rate between 1.6 to approximately four percent. it is implied that higher levels of foreign debt could be better for domestic currency value. this is also validated in all model scenarios. lagged dependent variable captures the dynamic effect and is also positive and significant, which validates the theoretical perspective that a past depreciation will further depreciate the currency value and vice versa. similarly, the iplm shock has a significant positive value in all models. this refers to an increase in the risk premium for a country's financial state that leads to the depreciation of its currency value. given the shock of productivity, risk in the economy's structure is observed. a positive productivity shock is always good for the economy's competitiveness and exchange rate. the south asian review of business and administrative studies vol. 4, no. 2, dec 2022 159 coefficient of wealth shock is negative and significant, meaning that an increase in output will appreciate the domestic currency valuation. this finding is significant for all models. moreover, the change's size is also more significant than other variables that may appreciate the exchange rate. control variables for the model are also indicative of notable implications. deviation of output shows a business cycle phenomenon, as the model without productivity shock shows a negative relationship that is altered to a positive one in the presence of shocks. so, there is more chance of a currency devaluation during periods of higher economic productivity. the exchange rate overvaluation is always negative and significantly related to currency depreciation. an overvalued domestic real exchange rate appreciates the nominal value of the currency. financial stability is also highly associated with currency appreciation. its coefficient ranges between 4 to 8 percent change in the nominal currency exchange rate. oil prices have a positive but insignificant relationship with the nominal devaluation of the domestic currency. this relationship can be positive or negative, given the country-specific nature of oil export and imports. if a country exports oil, an increase in global price will appreciate its currency, and if it is the main importer of the economy, its value will depreciate. the capital flow restrictions have a positive and significant relation with currency depreciation. there is approximately a 5 % higher chance of experiencing depreciation if we follow the policy of controlling the capital flow as per model 1. this chance remains significant, with a value of around 3% for models 2 and 3. the model's diagnostic is provided by the arellano-bond test with no serial autocorrelation ar (2). in this estimate, all models' presence of serial autocorrelation is not validated. the hansen test refers to the joint validity of restriction in the model. conclusion the incidence of the currency crisis has been quite common in the recent past. several economies have experienced various financial crises of varying natures and intensities. such crises have become more frequent in the past century by following the varying exchange rate regimes. every time a crisis emerges, it severely affects the economic stability and well-being of larger populations, not only for the affected country but across the world. in this research, several channels of a currency crisis are explored for emerging economies. a third-generation modified model is adopted for empirical analysis to observe how much change in a fundamental variable brings variation in the domestic currency’s value. to observe the dynamics of currency value, a sophisticated model is used. it is observed that foreign liabilities have a significant role in determining the currency devaluation of various countries. countries with high due loans are more likely to observe pressure on their currencies. this model is consistent with first-generation empirical studies. moreover, an overvalued real exchange rate also becomes a reason for depreciation in currency value. this happens due to the speculative pressure on the currency. additionally, the shock or risk premium productivity and weak economic structure are significant factors for depreciation. a positive relationship of the output shock is a potential implication for many countries to set the optimal strategy to avoid the negative consequences of a crisis. in addition to these, financial stability is another critical variable. if the countries have a higher level of stability, they are less likely to face depreciation. oil prices have a mixed effect on the economies. it may be positive or negative, given that a country is a significant exporter or oil importer. given the empirical results, it is recommended that countries should focus on reducing and managing the size of their foreign liabilities. monetary authorities must not overvalue the exchange rates and abandon the managed float to avoid speculative pressure. similarly, the policy for interest south asian review of business and administrative studies vol. 4, no. 2, dec 2022 160 rates should be investor friendly so that potential depreciation can be avoided. emerging economies can work on improving their export sector as a strong export sector can benefit in the situation of crisis instead of loss. governments and firms should focus on exploring and improving output production in the economies. as the positive productivity shocks have a long-lasting benefit for the economies. references agénor, p.-r. 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(2013). modeling of financial crises: a critical analysis of models leading to the global financial crisis. global journal of business research, 7(3), 101–124. south asian review of business and administrative studies vol. 4, no. 2, dec 2022 163 appendix table a.1 indicators of currency crisis according to theoretical model generations model indicators first generation fiscal deficit/ gdp excess real m1 balances second generation exports imports real exch. rate terms of trade output dom. real int. rate third generation dom. credit/ gdp m2/ foreign exch. reserves m2 multiplier bank deposits stock prices banking crises sovereign debt foreign debt/ exports s-t foreign debt/ exch. reserves sudden stops world real int. rates foreign exch. reserves source: (kaminsky, 2006; nakatani, 2018) table a.2 list of selected economies emerging market economies argentina egypt peru armenia gabon philippines bangladesh guatemala romania bolivia hungary russian federation brazil india sierra leone burundi indonesia south africa cameroon iran sri lanka central african republic jamaica thailand chile kazakhstan togo china, p.r.: mainland malaysia turkey colombia mexico ukraine costa rica moldova uruguay côte d'ivoire morocco venezuela croatia nigeria dominican rep. pakistan south asian review of business and administrative studies vol. 4, no. 2, dec 2022 164 microsoft word sabas, p23 v3 adil final.docx south asian review of business and administrative studies vol. 3, no. 1, june 2021 33 volume and issues obtainable at center for business research and consulting ibmas, the islamia university of bahawalpur pakistan south asian review of business and administrative studies issn: 2710-5318 ; issn (e): 2710-5164 volume 3, no.1, june 2021 journal homepage: https://journals.iub.edu.pk/index.php/sabas the impact of audit committee characteristics on the risk-taking behavior of firms in pakistan muhammad adil, institute of business, management and administrative sciences, the islamia university of bahawalpur, pakistan article details abstract history revised format: may 2021 available online: june 2021 keywords corporate governance, audit committee characteristics, corporate risk, gender diverse audit committee, several steps to bring corporate governance (cg) in place and operation, but the efficient working of the audit committee is an effective component for success. this study aims to examine the impact of the audit committee characteristics and, gender-diverse audit committee on corporate risk. this study analyses the risk behavior of non-financial firms listed on the pakistan stock exchange from the financial year 2010 to 2018. the findings of the study indicate that the audit committee characteristics have a negative and significant relation with idiosyncratic risk. furthermore, gender diverse audit committee has a significant negative relationship with the capital expenditure. our results show that the effect of audit committee characteristics such as audit committee independence, audit committee size, and, gender diversity is insignificantly associated with total risk. while audit committee independence, audit committee size, and gender diverse audit committee do support reducing corporate risk, and, they play a vital role in managing idiosyncratic risk. the findings of the analysis could help executives and boards in making appropriate choices regarding the audit committee's independence, size, and corporate governance structure and policies to improve the efficiency of the organization and mitigate risk. © 2021 the authors, under a creative commons attribution noncommercial 4.0 international license corresponding author’s email address: adilhashmi52@gmail.com doi: https://doi.org/10.52461/sabas.v3i1.528 introduction corporate governance is one of the important topics of today's corporate world. research has observed the impact of various cg reforms on corporations (ghafoor, zulfiqar, & khurshid, 2019b). an audit committee is considered a distinct element for cg and has earned wide attention worldwide (adhikary & mitra, 2016). the audit committee's role as regards accountability is further strengthened by the sox act. the sox act (2002) was established to mitigate corporation weaknesses and failures. according to the linck, netter, and yang (2009), the primary objectives of this act is to enhance corporate governance and reinforce the independence of the audit committee and the board. south asian review of business and administrative studies vol. 3, no. 1, june 2021 34 corporate governance tends to lead towards the development and stability of corporations by strengthening investor trust. audit committee play a crucial role in contributing integrity to disclosures and enhancing the trust of potential investors (r. m. alqatamin, 2018). the presence of an impartial audit committee also signals the organization’s commitment about effective corporate governance (adhikary & mitra, 2016). although in many countries it is mandatory for all publicly owned companies to has an audit committee and most non-public corporations also set up audit committee for greater control and accountability of the financial result. nginyo, ngui, and ntale (2018) argue that the audit committee plays a key role in corporate governance, regarding supervision and transparency of the company. supervision and transparency are considered the pillar of effective corporate governance. growing public and legislative importance of the audit committee in corporate governance, especially after the dot.com bubble incident (a. m. mohammed, 2018). the audit committee is seen as an important element for corporate governance and has gained wide-ranging worldwide publicity. policymakers, international bodies, and government officials, and have all stated that they see the audit committee as a highly effective tool that can improve the reliability and disclosure of financial information (bosse & phillips, 2016). bansal and sharma (2016) articulate that the audit committee as the eyes and ears of the board and plays a key role in helping to avoid and counteract the surge in reported fraudulent activities worldwide. the role of the independent audit committee has become more important due to numerous financial scandals in corporations such as enron and worldcom (salehi & shirazi, 2016). such scandals have created a great deal of uncertainty for corporations and the effects of these financial collapses have contributed to shaking investor confidence (lang & jagtiani, 2010). poor performance by the board of directors was one of the key reasons for the scandals (akbar, kharabsheh, poletti-hughes, & shah, 2017). the fraud of the taj quran company has happened in pakistan. "securities and exchange commission of pakistan" released the cg code to ensure transparency and accountability in the public & private sector (ayaz, 2017). corporate governance is now a priority in emerging countries after the financial collapses of the past, which have led to the need for better corporate governance policies (paulinus, oluchukwu, & somtochukwu, 2017). after the financial scandals there is a continuous improvement in corporate governance. the audit committee has quite a significant role in improving the consistency of financial statements, evaluating and analyzing the internal control structure and controlling the collaboration between the executive and various stakeholders (omar, rahman, & hamid, 2018). according to the contessotto and moroney (2014), the audit committee maintains the credibility of financial reporting and thus improving the consistency of the published figures. younas, klein, trabert, and zwergel (2019) find that the proportion of independent directors on board had a negative effect on corporate risk. another aspect of corporate governance, which has gained growing recognition to improve transparency and creditability, is gender diversity in different executive committees. females are perceived to have high moral principles and more risk averse than men particularly when it comes to engaging in financial matters. unlike men, females are more concerned with fairness and accountability and rely on regulations. ali, liu, and su (2018) examine that inclusion of women on board would mitigate default risk. wilson and altanlar (2009) argue that the probability of insolvency is negatively linked to the percentage of female directors. beck, behr, and guettler (2013) suggest that the recovery of debts issued by the female staff is far less expected to go into arrears. there have been few research that look into the relationship between corporate governance, independent audit committees, and risk. sheikh (2019) looks on how ceo authority affects company risk. as a result, this variable has a considerable and favourable impact on business risk, but only when there is a high level of market competition or strong corporate governance. tai, lai, and yang (2018) investigate the audit committee's and board's roles in south asian review of business and administrative studies vol. 3, no. 1, june 2021 35 corporate risk. the board of directors, particularly the audit committee, has a significant influence on the corporation's hedging decisions, including whether and how much to hedge. this study is unusual in the context of pakistan because, despite extensive research, the influence of a genderdiverse independent audit committee on business risk has yet to be investigated in pakistan. due to the existing lack of conclusive findings and a literature gap, this study examines whether the independent audit committee and the inclusion of women on the audit committee help to decrease risk faced by businesses. the research predicts that an independent audit committee and female representation on the audit committee will have an impact on corporate risk, based on agency theory. literature review and hypothesis development corporate governance governance is commonly accepted as a major factor of all organizational practices’ effectiveness and failure. the framework of corporate governance, depending on the country and implemented internationally with various features (almaskati, bird, & lu, 2020). corporate governance provides different motives for various individuals in various ways. it includes the framework by which company's targets are developed and the mechanism to meet those targets and monitor results (kusi, gyeke-dako, agbloyor, & darku, 2018). due to the growing concern about corporate fraud & false financial statements, the idea has become famous for developing and emerging economies. pakistan has reported numerous corporate frauds. corporate governance has become the main determinants of the stability of a company's structure and strength to endure economic shocks. corporate governance has become the structure in which organizations are monitored and controlled. good accountability and governance guidelines offer a collaborative framework for corporate governance activities (rani & gautam, 2017). it is been found from previous studies that a firm's management and business longevity are aligned with the governance style and economic landscape demands strong corporate governance (jabeen & oudah, 2018). the principle of corporate governance is based primarily on the answerability of directors to stockholders (mlambo, 2017). so corporate governance system lays out the division of rights and duties between various organizational members, such as the board, executives, principal and other investors, and lays out the principles and protocols for the verdicton organizational issues. ayandele and emmanuel (2013) state that corporate governance encourages transparency and answerability. the corporate investor expects a hefty amount of return, which is possible due to a good and effective framework of corporate governance, whereas poorly regulated companies face risk. spanos (2005) find that corporate governance has important consequences for the economic potential, as good management decreases investor risk, and increases corporation performance. sarbah and xiao (2015) state that strong corporate governance leads to sustainable business growth by improving organization efficiency and increasing access to outside resources and investment. investors tend to work with businesses with the best corporate practices. most of the popular ideas which have already been commonly used throughout corporate governance as well as risk reduction research known as agency theory. agency theory describes the interaction among two groups such as the corporate managers and owners whom interests are not compatible with one another (banks, woznyj, kepes, batchelor, & mcdaniel, 2018). wagana and nzulwa (2017) describe that this relationship the transfer of certain decision-making rights to managers. the enterprise is not a person but a lawful fiction in which conflicting goals of persons are put in balance through the system of contractual relations (eisenhardt, 1989). the purpose of these agreements is that both parties are working for the benefit of company and to reduce the costs of the agency. as a result, owners have the right to recruit executives, so they would need a south asian review of business and administrative studies vol. 3, no. 1, june 2021 36 plenty of details to determine manager performance. a company is a network of contractual relationships (jenson & meckling, 1976), according to agency theory, consisting of different stakeholders that have varied interests (bosse & phillips, 2016). this theory offers a mechanism to understand how to set up an appropriate control and reward program in the light of ambiguity and limited information. shi (2019) remark that a good framework of governance can demote the dispute between the executive and shareholder. he proposes two solutions to mitigate issue between principal and executive. the first solution provides a logical result-based contract, where the agent’s activities can be verified. the second principal requires establishing a clear information system under which the shareholder is conscious all the details regarding the behavior of the managers and cannot mislead the principal (chen, 2010). effective corporate governance policies balance the priorities of shareholder and managers with that of the shareholders and turn them into successful risk control approaches (elbahar, 2016). corporate governance and corporate risk risk can often be interpreted as just an opportunity in which yields outcomes distinct from those initially expected. risk is categorized as manageable (unsystematic) and unmanageable (systematic) risk. systematic/ unmanageable risk is a business risk that affects the whole economy, not individual businesses, and that is caused by extrinsic factors: rampant inflation, unemployment and recession (ullah, hashim, khan, & safi, 2017). unmanageable risk cannot be managed but could be attenuated through diversification. corporate governance has impact on corporate risk. the good system of corporate governance will mitigate corporate risk. in fact, a company that does not show good corporate governance appears to impose less constraints on executives and, as a result, executives are granted more discretion to make business decisions that prevent compromising their personal interests. corporate governance encompasses many facets, including problems to be resolved in the organization, the legal structure the allocation of ownership rights or the interests of monetary and non-monetary stakeholders (ghafoor et al., 2019b). tahir, afzal, liaqat, tahir, and ullah (2019) find that corporate governance is characterized as a system containing of protocols for business management, enhancing performance, oversight and accountability and acting in the interests of all participants. jiraporn, chatjuthamard, tong, and kim (2015) explore how the consistency of corporate governance affects risk. they note that more efficient corporate governance contributes significantly reduced corporate risk. cohen, dey, and lys (2013) examine the influence of the sox act on organizational risk-taking. bargeron, lehn, and zutter (2010) find convincing proof of changes in corporate investment and hazard-taking behavior. they record the reduction in enterprise risk-taking actions after sox. studies around the world have shown that good corporate governance procedures play a diversified position in risk reduction. błach (2010) describe that risk is interpreted as the disparity between real gain and the desired gain. independence of the audit committee and corporate risk an audit committee is a committee of an organization’s body which is responsible for surveillance of the financial reporting process and internal control system (toumeh & yahya, 2017). the audit committee is authorized to act on behalf of the “board of directors” by performing a vital task of accountability in corporate governance. it aim to safeguard capital providers and to ensure transparency for businesses (hasibuan & auliya, 2019). the concept of agency theory implies that the beneficial oversight function of management practices is most often carried out through independent directors in the audit committee (chariri & januarti, 2017). after numerous corporations failures around the world ,the importance of creating an effective and independent audit committee in order to strengthen corporate governance has been recognized more and more (al-najjar & abed, 2016). menon and williams (1994) find that corporations have reduce their corporate costs and problems by taking part in a greater overseeing activity through audit committees. so, audit committee plays an important role in corporate governance mechanisms and south asian review of business and administrative studies vol. 3, no. 1, june 2021 37 reduces the risk of the organization and reducing the information gap through transparent financial reporting (bassiouny, 2016). financial reporting is a primary way of disclosing the financial position of a business to investors so the audit committee can play a vital role in reducing the information gap between investors and corporate managers (khlif & samaha, 2016). one of the audit committee’s initial function is to manage the process of financial reporting. an independent audit committee executes a higher quality of monitoring, which results in improved financial reporting. bédard and gendron (2010) report that independent directors have no personal or economic relationship with management and for this reason can operate independently without any management influence. according to the pérez-cornejo, de quevedo-puente, and delgadogarcía (2019) independent directors are independent in the sense that they do not have any material relationships with either managers or owners. allegrini and greco (2013) find that having an independent audit committee provides an increased possibility of monitoring and reduces the opportunities for management to withhold information for its advantage. defond and francis (2005) examine that independent director within the audit committee are more efficient at reviewing than their counterparts. having an independent audit committee will improve the business by increasing its reputation and providing unbiased decision-making (haniffa & cooke, 2002). the actions of the audit committee are the best tool for minimizing the risks and complexities found in the current business climate. poretti, schatt, and bruynseels (2018) state that the independence of the audit committee is viewed as crucial to its successful monitoring functions. the independent audit group minimizes the risk of enterprise failure (carcello & neal, 2003). ghabayen (2012) remark that the role of the audit committee and its operations within the corporation encourage prospective investors and reduce the corporate and operational risk of the business. ullah et al. (2017) state that corporate governance negatively impacts on solvency risk. he also finds that audit committees and board independence negatively impact on solvency risk. audit committee size and corporate risk the committee's magnitude is the total of team members selected by regulatory bodies. li, mangena, and pike (2012) describe that the audit committee has been one of the central and important protagonists in corporate governance because it helps the board carry out its duties in overseeing corporate governance. the exact number of representatives of the audit committee is important for monitoring executives and detecting misleading conduct. according to the tarus, tenai, and komen (2019) size of the ac strengthens the mechanism of financial reporting consequently reducing the asymmetric facts between executives and stakeholders. lipton and lorsch (1992) note that the audit committee 's monitoring capacity boosts as the number of its representatives' increases. yermack (1996) remark that a smaller size of the audit committee increases the efficiency of corporations. this stance is consistent with jensen (1993)'s statement that a limited audit committee increases the efficiency by which the audit committee plays a vital role in supervision and accountability. anderson, mansi, and reeb (2004) state that the big size audit committee spends an ample amount of time reviewing the process of financial reporting and internal control. the audit committee retains and enhances public confidence in the accuracy and integrity of financial reporting. consequently, the size of the ac would be necessary to properly evaluate its role in the business for the enforcement of key decisions regarding the organization's risk management policy (tarus et al., 2019). the size of the ac is about to be related to the actual execution of its responsibilities. at least three members in the ac as stated in the code of corporate governance 2012 of pakistan (khan, ali, & boudiab, 2017). the size of the ac seems to be the most important feature of ac as it instantiates all the other characteristics such as independence and knowledge (dhaliwal, naiker, & navissi, 2010) . madawaki and amran (2013) find in his study larger audit committees hold more authority, reputation and resources, thereby enhancing south asian review of business and administrative studies vol. 3, no. 1, june 2021 38 monitoring and improving the detection of problems and fraud resulting in enhanced internal control. it is noted that the appropriate size of the ac may have been more effective in dealing with organization issues (sultana, singh, & van der zahn, 2015). however, small-size ac has wide range of expertise and can ensure adequate monitoring (bédard & gendron, 2010). yatim's (2009) findings state a significant and positive relationship between the audit committee size and risk management. he demonstrates that broad audit committees can influence internal control efficiency, thus encouraging the design of risk management systems. gender diversity of audit committee and corporate risk the past few years have shown a dramatic rise in the concentration of females amongst top management and boards of directors in companies (chijoke-mgbame, boateng, & mgbame, 2020). gender diversity is likely to impact the decisions of a business and recommend that females have distinct viewpoints and require different details from males (r. alqatamin, aribi, & arun, 2017). several feminist experts claim that females are more likely to be ethical and neutrals than are males (nelson, 2012). in recent years, both investors and society have started a campaign for the hiring of women directors on company boards. study conducted by the american institute of certified public accountants regarding work, life, and female initiatives over 50% of recent graduates is females. in the majority of countries, the percentage of women in top executive positions is still low (keiran, 2017). smith, smith, and verner (2006) find numerous cases for emphasizing the importance of females on the boards. various, studies regarding the effects of corporate governance expect that the presence of women on audit committees may enhance oversight activities (ittonen, miettinen, & vähämaa, 2010). byrnes, miller, and schafer (1999) find that the presence of females on board provides positive results in corporate monitoring. the membership of females on the boards would produce a healthier image of the overall view of a business and it will make a positive effect on the performance of the company. risk-taking assessment is very important for the company's performance (nakano & nguyen, 2012), specifically in improving the efficiency and value of the firm which consequently increases the shareholder's value (firdaus & adhariani, 2017). diversity in boards of directors is also required to help the mission and thorough decision-making because it can bring many perspectives (faccio, marchica, & mura, 2016). in the context of agency theory, diverse directors can improve the capacity of the supervisory and decision-making mechanism of the board of directors to influence company outcomes (carter, d'souza, simkins, & simpson, 2010). gold, hunton, and gomaa (2009) summarize sociological and psychological studies on gender differences indicate that women avoid risk and are more ethical than males. croson and gneezy (2009) report three fundamental differences about risk perceptions, social perceptions, and competitive preferences based on gender. according to their survey report, women have been generally risk-averse. a gender-diverse committee may aid to negate unnecessary and extreme risk-taking. lenard, yu, york, and wu (2014) find that presence of females on the bod impacts on to decrease stock yield volatility. female board members tend to have a clear understanding of enterprise in contrast to male counterparts. burgess and tharenou (2002) suggest that the ratio of corporate scandals may be lessened by increasing the females as directors on the board. role of agency theory in cg & ac agency theory provides a sound basis on which to justify the value of the independence of the auditor. that means one important method to regain the interest of investors is to get an impartial auditor reporting on the financial statements (chariri & januarti, 2017). all businesses need to prepare a reliable report on financial details. quality of financial reporting is treated as the most important element in the statement of financial performance. according to the alzeban and sawan (2015), independence of ac representatives is one of most important factors in enforcing internal audit mechanism. audit offers a dual added quality for the disclosure of financial statements. alsouth asian review of business and administrative studies vol. 3, no. 1, june 2021 39 shaer, salama, and toms (2017) find that corporations with higher quality acs present of higher quality financial disclosures. the independence of auditors is essential for the accuracy and uprightness of the financial statements. kanagaretnam, krishnan, and lobo (2010) describe that the independent audit committee with experience are more capable of identifying misrepresented parts of financial statements which can impact the client due to their accurate representation, so that the outcome is to provide credible financial information. further professional auditing increases the precision of the information presented and helps investors to predict greater accurately than in the business (paydarmansh & khorrami, 2014). independent ac executes more efficient monitoring roles. kamarudin, ismail, and samsuddin (2012) find a strong association between an impartial ac as well as the quality of the financial reports. it can also be argued that an autonomous ac can conduct its supervisory role more efficiently with in the corporate governance system of a company and thus increase the quality and reliability of financial reporting. autonomous members of the audit committee can adequately monitor manager's activities to enhance csr disclosure and, minimize agency issues. allegrini and greco (2013) further claims that independence of the audit committee could benefit the business by providing integrity, experience and unbiased decision-making. corporations have more independent auditors are often more likely to disclose flaws in internal control. according to the by kantudu and samaila (2015) overseeing the financial reporting process carried out by management will be transparent through the involvement of an independent audit committee. it's because autonomous audit committees are accountable to the board committee (setiany, hartoko, suhardjanto, & honggowati, 2017). businesses with elevated-quality reporting more follow accounting practices because good accounting practices facilitate the disclosure of their superior quality (dyczkowska, 2014). he argues that these corporation are able to take advantage of open contact with investor in order to show their competitive edge. for the future, businesses with poor-quality reports will seek to conceal these reports and thus make a limited degree of disclosures. role of signaling theory in cg & ac spence originated the signaling term in 1973, based on akerlof's article 1970. signals are communication signals that are transmitted from one group to another to affect the intended results (taj, 2016). signaling theory has often been used in corporate governance research to describe individual actions towards information asymmetry (bergh, connelly, ketchen jr, & shannon, 2014). stakeholders can access predict risk through financial reporting (sulistyaningsih & gunawan, 2018). in addition, numerous scandals have reinvigorated attention to corporate accountability. according to signaling theory, businesses with high-information transparency indicate strong corporate governance. wang (2009) examine that the transparency increases the corporate’s value and gives an indication to stakeholders that executives work efficiently in their interest. it indicates that financial reporting provides details that is beneficial to investors in evaluating the corporation 's effectiveness and prospects. in the sense of corporate governance, ac which is mainly responsible for overseeing the mechanism of financial reporting is likely to send valuable signals to participants in the capital market. when it comes to the accuracy of the information, fund providers are more concerned about the characteristics of acs because it provides as essential signals about the integrity of internal monitoring mechanisms (appuhami, 2018). despite the roles delegated to acs as main decision-making authorities, so it is a chance of a lawsuit if there are factual errors in the financial reports (dao, huang, & zhu, 2013). the presence of an independent audit committee also transmits a signal about the attention of organization's good corporate governance. hypothesis development acknowledging the importance of an independent audit committee and female members of the ac on corporate risk, it is important to provide research focused on the improvement of corporate governance structure and procedures within pakistani companies. the independent audit south asian review of business and administrative studies vol. 3, no. 1, june 2021 40 committee is much better than the non-independent audit committee because they have more capability to bear the pressure by the executives and higher management (r. m. alqatamin, 2018). zulfikar, may, suhardjanto, and agustiningsih (2017) independent directors are independent in the sense that they do not have any material relationships with either managers or owners. the actions of the audit committee are the best tool for minimizing the risks and complexities found in the current business climate. cost-related problems occurring in corporation reduced with the help of an independent audit committee (mohammed, 2019) . the independent audit group minimize the risk of enterprise failure (carcello & neal, 2003). ghabayen (2012) remark that the role of the audit committee and its operations within the corporation encourage prospective investors and reduce the corporate and operational risk of the business. various studies (damak, 2018; groening, 2019; oremus, 2020) have led to the conclusion that females are found to be more engaging and beneficial to be considered as a member of the board and committee. they are known to be more risk-averse, more active, and responsible as compared to men (hurley & choudhary, 2020). therefore, it is suggested that the independent audit committee, and the presence of females as ac member, highly contribute to minimizing the risk of the corporation. the key objective of this analysis is to examine the position of the independent audit committee, gender diverse audit committee and, audit committee size, to reduce the risk of the listed company in pakistan. h1: there is a negative relationship between audit committee characteristics and corporate risk. h2: there is a negative relationship between gender diverse audit committee and corporate risk methodology methodology characterizes the method used in studying the research area. different methods and the way are used. the appropriate methodology for this study is quantitative, as it aims to collect and analyze empirical data to understand and check the impact between observed variable corporate risk and explanatory variables gender diverse independent audit committee and audit committee size. the study sample size is 102 non-financial companies and which time duration from 2010-2018. the sample consists of various non-financial manufacturing sectors of the economy such as oil and gas, paper and board, personal use and food, sugar, chemical, textile, miscellaneous, power and distribution, fertilizer, gas, and ceramics tobacco, pharmaceutical, technology, and communication, tanneries, and leather. to collect appropriate empirical data i use the data collection strategy of (ghafoor et al., 2019b). one-shot data provides details on both time and space (zia, 2017). sample size this study considered non-financial firms of psx (pakistan stock exchange). however, financial firms were excluded due to different regulatory framework. the study also excluded those firms having less than seven years of data. table 1: description of sample selection total firms on (psx) 559 firms excluded having less than 9-year data 140 financial firm excluded 158 firms with incomplete data 159 firm for final analysis 102 south asian review of business and administrative studies vol. 3, no. 1, june 2021 41 measurement of variables the dependent variable of this study is the corporate risk. risk is measured as the standard deviation of daily stock returns and the standard deviation of the residuals from the (fama french carhart four factor) model estimated from daily returns. previous studies (cain & mckeon, 2016; ferris, javakhadze, & rajkovic, 2019; low, 2009; pathan, 2009; sheikh, 2019) use idiosyncratic risk and total risk to measure corporate risk. to calculate the residuals of the fama–french four factors model, first, daily stock returns were calculated for listed firms. the book to market ratio and the market capitalization is also arranged for these funds. then, in each year, firms were independently allocated to two size groups based on the market capitalization. firms were also independently allocated, three book-to-market groups. six portfolios were then created from the intersection of two sizes and three book-to-market groups. value weighted daily returns were calculated for these six portfolios. these six portfolios were used to find the small minus big (smb) factor and high minus low (hml) factor. further, the momentum factor, firms were classified into winners and losers based on their cumulative 11-months returns, the winner minus loser stocks created the momentum factor. to find the residuals of the carhart 4 factor model, the risk-free rate was deducted from the daily stock returns. then for each stock, a regression of excess stock returns was estimated for each stock in each year, and its residuals were obtained. the standard deviation of the residuals was then obtained for each firm. this figure is then used as a proxy for risk. another proxy of risk is the standard deviation of the daily stock returns for each within each year. to examine the effect of audit committee characteristics on corporate risk we use idiosyncratic risk, total expenditure and capital expenditures as a proxy of corporate risk. the independent variables of this study are the independent audit committee and females board members. independent audit committee measured as the number of independent directors divided by total audit committee size in the firm i in year t and female on ac measure as a number of females in ac. nine control variables used in this study firm age, return on assets, sale growth, market to book value surplus cash, leverage, and firm size. table 2: operational measurement of variables variable symbol description author x1 acind the proportion of independent directors who are members of the audit committee. (hasan, molla, & khan, 2019) x2 ac size total number of ac members (appuhami, 2018) x3 gdac percentage of female members on the audit committee. (r. m. alqatamin, 2018) x4 total risk standard deviation of daily stock returns. (sheikh, 2019) x5 idiosyncratic risk standard deviation of the residuals from the fame french carhart four factor model (sheikh, 2019) south asian review of business and administrative studies vol. 3, no. 1, june 2021 42 x6 capex net capital expenditure to assets (liu, gan, & karim, 2020) x7 firm age the difference between the current fiscal year and the year founded. (tarus, tenai, & komen, , 2019) x8 leverage total liabilities divided by the total assets. (liu et al., 2020) x9 size of the firm as logarithm of total assets. (tarus et al., 2019) x10 mtbv the market value of total assets to the book value of total assets (market to book ratio) (liu et al., 2020) x11 netppe net, property, plant, and, equipment to total assets (liu et al., 2020) x12 sales growth log (sales t/sales t−1) (liu et al., 2020) x13 stock return annual return over the fiscal year (liu et al., 2020) x14 roa return on total assets (liu et al., 2020) data analysis table 3 provides a descriptive analysis of this study. this section provides descriptive statistics for all variables in this research for the period 2010 to 2018. the finding from correlation analysis is presented in table 4. table 5, 6 and 7 presents the findings of the regression analysis. table 3: descriptive statistics variables obs mean std. dev. min max dependent variable total risk 865 0.590017 0.510877 0.004678 4.499108 idiosyncratic risk 865 0.031294 0.018253 0.003606 0.168171 capital expenditures 853 1.48e+09 4.89e+09 -4.15e+09 6.63e+10 independent variables ac_size 918 3.539216 0.771697 3 7 proportion of_ind 918 0.207843 0.182266 0 0.8 proportion of_fac 918 0.091158 0.163537 0 0.666667 control variables return on asset 870 0.067219 1.842893 -54.0543 2.184888 leverage 870 0.563176 0.460878 0.007218 8.790163 stock return 914 0.55072 0.388162 0.005943 7.465228 market to book value 679 4.071256 12.99577 -12.3936 248.212 firm age 918 37.04031 14.60365 8 69 net property & plant 870 0.388919 2.939999 -85.6023 0.997542 surplus cash 870 0.052553 0.0901 0.000177 0.751854 south asian review of business and administrative studies vol. 3, no. 1, june 2021 43 table 4: correlation matrix variables tota_risk idiosyn_risk capex r&d leverage ac_size pro_ind pro_fac roa stock return mtbv firm_age net ppt surplus cash tota_risk 1 idiosyn_risk 0.8062* 1 capex -0.1049* -0.1816* 1 leverage 0.0529 0.1314* 0.1046* -0.0355 1 ac_size -0.0649 -0.1680* 0.1207* 0.0292 -0.0755* 1 pro_ind 0.0442 -0.0253 0.1980* 0.0408 -0.0025 0.0403 1 pro_fac 0.0462 0.0934* 0.0830* -0.0316 -0.0072 -0.1398* -0.056 1 roa -0.1231* -0.1952* 0.0182 0.0189 0.0173 0.0325 0.0383 0.0103 1 stock return 0.0106 0.0265 0.0583 -0.0584 0.0261 -0.0172 -0.0052 -0.0121 -0.0121 1 mtbv -0.0067 -0.0214 0.0583 -0.0584 0.1411* 0.0537 0.0287 -0.0237 0.3006* -0.0882* 1 firm_age -0.0505 -0.0941* -0.0095 0.051 -0.0740* 0.0278 0.1200* -0.1145* -0.0026 -0.0393 -0.0418 1 net ppt 0.0039 -0.0047 0.1903* 0.0803* -0.0614 0.0301 -0.017 0.027 -0.0076 0.0195 -0.0196 0.0044 1 surplus cash -0.0348 -0.1368* 0.0181 0.0058 -0.0881* 0.1536* 0.0067 -0.0552 0.0386 -0.0769* 0.0192 0.0864* -0.014 1 t-statistics indicate significant level p<0.01 ***, p<0.05 **, p<0.1* south asian review of business and administrative studies vol. 3, no. 1, june 2021 44 table 5: regression analysis variables idiosyncratic risk model 1 model 2 model 3 audit committee size -0.003*** proportion of ind -0.007* proportion of females ac -0.0003*** return on asset -0.025*** -0.026*** -0.027*** leverage -0.001 -0.001 -0.001 market to book value 0.0001*** 0.005*** -0.0001*** firm age 0.000 0.659 0.000 net ppt -0.0001*** -0.0001*** -0.0001*** surplus cash -0.004 -0.007 -0.006 fixed year effect yes yes yes constant 0.041*** 0.032*** 0.031*** n 644 644 644 r-square 0.0974 0.0974 0.0974 t-statistics indicate significant level p<0.01 ***, p<0.05 **, p<0.1 *, dependent variable: idiosyncratic risk independent variable: audit committee characteristics and gender diverse audit committee as presented in table 5 model 1 which described the relationship between audit committee size and idiosyncratic risk. it is noted that the audit committee size, is negatively and significantly associated with idiosyncratic risk at the level (p<0.01). as per the results indicated in table 5 the association between audit committee size and idiosyncratic risk is significant. audit committee size is an important element of corporate governance. (ghafoor et al., 2019; jiraporn et al., 2015) who find a significant association between corporate governance and idiosyncratic risk. previous literature shows the relation between corporate governance and idiosyncratic risk while this study shows the further contribution of the audit committee in this regard. model 2 which described the relationship between an audit committee's independence and idiosyncratic risk. it is noted that the audit committee's independence, is negatively and significantly associated with idiosyncratic risk at the level (p< 0.01). the association between audit committee independence and idiosyncratic risk is significant. hamza and mselmi (2017) underline that the independence of the audit committee leads to greater accountability and reduced idiosyncratic risk. the effect of corporate governance on the risktaking of us firms is examined by (jiraporn et al., 2015). their measure of corporate risk comprises idiosyncratic risk and total risk. they find that corporate governance reduces the corporate risk of the organization significantly. previous literature (ghafoor, zulfiqar, & khurshid, 2019a; jiraporn et al., 2015) shows the relation between cg and idiosyncratic risk while this study shows further contribution of the audit committee in this regard. as indicated in table 5 model 3 describes the relationship between the gender diverse audit committee and idiosyncratic risk. it is noted that the gender diverse audit committee is negatively and significantly associated with idiosyncratic at the level (p< 0.01). south asian review of business and administrative studies vol. 3, no. 1, june 2021 45 according to the result association between the gender diverse audit committee and idiosyncratic risk is significant. our result consistent with (nadeem, suleman, & ahmed, 2019) who find that gender diversity reduces idiosyncratic risk. gender diverse audit committee representation decreases the unavoidable risk of misleading misstatements (ittonen et al., 2010). table 5 depicts the results of the regression analysis of idiosyncratic risk on audit committee characteristics and gender diverse audit committee. ullah et al. (2017) find that corporate governance negatively impacts on solvency risk. he finds that audit committees and board independence negatively impact on solvency risk. tai et al. (2018) explore the role of the audit committee and the board on corporate risk. he finds that the audit committee plays a major role in the hedging decisions of the corporation, including whether and to what degree to hedge. our first hypothesis states that there is a negative relationship between audit committee characteristics and corporate risk. while the second hypothesis postulates that there is a negative relationship between the gender diverse audit committee and corporate risk. our results show that audit committee characteristics and gender diverse audit committee have a significantly negative link with idiosyncratic risk a proxy of corporate risk. this result accepts our h1 and h2. table:6 regression analysis variables capital expenditure model 1 model 2 model 3 audit committee size 0.635*** proportion of ind 5.780* proportion of females ac -2.050*** return on asset 6.200*** 5.780*** 6.650*** leverage 1.040* 1.210** 1.010* stock return -0.022 -0.005 -0.018 market to book value -0.021 -0.017* -0.021** firm age 0.059*** 0.052*** 0.055*** net ppt 0.019 0.030* 0.27* surplus cash -7.280*** -6.210*** -6.840*** fixed year effect yes yes yes constant -5.450 -4.210 -2.930 n 598 598 598 r-square 0.084 0.084 0.084 t-statistics indicate significant level p<0.01 ***, p<0.05 **, p<0.1 *, dependent variable: capital expenditures independent variables: audit committee characteristics and gender diverse audit committee. mode 1 describes the link between audit committee size and capital expenditure, as shown in table 6. capital expenditures are a proxy for corporate risk that we employ. capital expenditures are a high-risk investment with an uncertain return (liu et al., 2020). according to the findings, there is a substantial relationship between audit committee size and capital spending, implying that the variation in capital expenditure can be explained by audit committee size. the association between audit committee independence and capital expenditure is significant at the level (p0.1), as shown in model 2. the link between a gender diverse audit committee and capital expenditure is significant at the level (p0.01). the gender diversity of the audit committee is found to be negatively and significantly associated with capital expenditure. the regression analysis of the association between audit committee features (independence, size), gender diverse audit south asian review of business and administrative studies vol. 3, no. 1, june 2021 46 committee, and capital spending is presented in table 6. there is a considerable and positive relationship between audit committee qualities and capital expenditure. while the data corroborate h2, they also demonstrate a strong and unfavourable relationship between a gender diverse audit committee and business risk. table 7: regression analysis variables total risk model 1 model 2 model 3 audit committee size -0.036 proportion of ind -0.093 proportion of _females ac -0.026 leverage 0.024 0.019 0.018 return on asset -0.439** -0.449** -0.469** market to book value 0.001* 0.001 0.001 firm age 0.005 0.000 0.000 net ppt -0.001* -0.001** -0.001** surplus cash 0.147 0.106 0.119 fixed year effect yes yes yes constant 0.601*** 0.495*** 0.485*** n 643 643 643 r-square 0.108 0.108 0.108 t-statistics indicate significant level p<0.01 ***, p<0.05 **, p<0.1 *, dependent variable: total risk independent variable: audit committee characteristics and gender diverse audit committee. it is noted that the audit committee size is negatively and insignificantly associated with total risk. according to the result association between the audit committee size and total risk is insignificant, which means that the variation in the total risk cannot be explained by the audit committee size. this result is consistent with previous studies; (bates & leclerc, 2009; elamer, alhares, ntim, & benyazid, 2018; fraser & henry, 2007), who conclude that due to time constraints, ac faces challenges in managing risk with proper perspective and concentration because they have already been assigned heavy responsibilities in the extensive range of internal control work. kpmg survey data reveal that the audit committee concentrates on monitoring financial statements and associated compliance risks instead of a broader risk management scope and that the audit committee is not comfortable doing so (brown, steen, & foreman, 2009). as presented in model 2 which described the relationship between audit committee independence and total risk. it is noted that the audit committee's independence, is negatively and not significantly associated with total risk. as per the results indicated in table 7 the association between audit committee independence and total risk is insignificant. this result is consistent with (fraser & henry, 2007) who find that the independent ac members lack comprehensive information about the risk that a business faces and how the risk is being managed. the reason behind the insignificant association between audit committee independence and total risk is audit committee members lack comprehensive information about the risk that a business face. the important element of corporate governance is independence (ameer, 2013). but there's no concept of autonomous directors in pakistan. independent directors are practically absent in pakistan corporations. many businesses in pakistan south asian review of business and administrative studies vol. 3, no. 1, june 2021 47 present a number of their directors as independent and claim to be independent, but none of them is independent in fact (ameer, 2013). she finds that most of the businesses are controlled by families. and they generally tend to stay aside from directors that they can't monitor. model 3 which describe the relationship between gender diverse audit committee and total risk. the association between gender diverse audit committee and total risk is insignificant. the mechanisms and rules involved in corporate governance are not playing significant role in shaping organizations (shafique, idress, & yousaf, 2014). according to őnday (2016), pakistan is one of the lowest rank of gender diverse and female economic participation countries in the world, where pakistan score only 22 %. (javeria ameen (2017)) find that all firms listed on pakistan stock exchange only 25 percent of the firms has one woman in board. due to limited involvement in board and its sub-committee gender diverse audit committee insignificant association with total risk. the regression analysis 7 does not give support for hypothesis 1 and hypothesis 2. consequently, hypothesis 1 and hypothesis 2 are not accepted. sheikh (2019) investigates the impact of ceo power on corporate risk. thus, the impact of this variable is significant and positive on corporate risk but this positive association stays significant only when there is a high market contest or strong corporate governance. previous study literature describes association between corporate governance and total risk while this study shows the further contribution of audit committee characteristics and gender diverse audit committee in this regard. conclusion corporate governance is essential in our current business scenario after the worldwide corporation scandals. corporate governance has obtained a considerable range of importance and has become a focus of public discussion in both developed and emerging nations. in the context of the corporation's supervision, accountability, and transparency, audit committee characteristics play an important role in corporate governance. the purpose of this study is to see if having an independent audit committee, having a large audit committee, and having a gender diverse audit committee are all linked to a significant reduction in corporate risk. from 2010 to 2018, this study looked at the risk behaviour of non-financial firms listed on the pakistan stock exchange. we discovered that having an independent audit committee, having a gender diverse audit committee, and having a large audit committee have a negative and significant relationship with idiosyncratic risk. furthermore, our research demonstrates that audit committee independence, audit committee size, and gender diversity are all significantly and positively linked with capital expenditures, whereas gender diverse audit committees are inversely associated with capital expenditures. according to the findings of this study, there is a strong and negative relationship between certain audit committee characteristics and corporate risk in pakistani non-financial firms. this study results important for the government entities and companies to see how they can execute corporate governance policies and avoid risk. implications of the study recent scandals, such as the fall of enron, have highlighted the importance of strong corporate governance. the size of the audit committee, the independence of the audit committee, and the gender diversity of the audit committee are all significant aspects of corporate governance. as a result, this research is crucial. the following are some of the study's practical implications: the purpose of this research is to assess the influence of monitoring methods such as an independent audit committee, audit committee size, and gender diversity on audit committees. decision-makers can assess the role of various monitoring methods and their perceptions of the organization's corporate governance. the relationship between the elements of corporate governance and the corporate risk of non-financial enterprises in pakistan is investigated in this study. the information offered in this study about the components of corporate governance and their impact on company risk can help management make the best decisions possible about their boards in order to increase south asian review of business and administrative studies vol. 3, no. 1, june 2021 48 their efficiency and business value. corporate governance bodies, particularly in pakistan, can use this study as practical and plausible evidence to develop more corporate governance rules and recommendations. limitation of the study the present research has certain weaknesses that need to be identified when evaluating the results of the analysis. the following segment addresses these limitations. firstly, this study selected pakistan as a single country for research. the study's scope was confined to the 102 listed firms in the pakistan stock exchange. financial companies have been excluded from this study. the current study relies on a quantitative approach for data collection and analysis. the current study did not follow the qualitative approach. however, the use of qualitative methods, such as interviews and, questionnaires in contrast to the qualitative method, may enhance the understanding of corporate risk and the independent audit committee issues. although these limitations are recognized these limitations are not diverting attention from the benefits of this study and the relevance of its results. the limitations primarily provide future study avenues several of which are explained in the next section. future research the future researcher will apply the same model in other regions of different countries and their financial sector and non-financial sector. moreover, this study selects pakistan as a single country so in-depth research can collect data from the other two or three countries and conduct a comparative analysis. in this research work, no moderator has been applied but furthermore, the researcher can take family ownership as a moderator. the corporate risk in this model has been used as a dependent variable so the future researcher can take voluntary disclosures, financial distress, and risk management as a dependent variable in the same model. in this research work has been taken out a sample of 9 years of data so future researchers can take more years of data for the fairness of study findings. this study has only tested the link with the values obtained on an independent audit committee, a gender diverse audit committee, and corporate risk. analyzing the same parameters with different datasets can recommend other important statistical tests which might enable additional insight. a recommendation may be to examine whether there was a similar connection between year-to-year transitions in corporate governance elements and corporate risk. another study could also examine the association that exists furthermore, for example, analyzing whether a possible causal correlation exists between these parameters. references act, s. s.-o. 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