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ABC Journal of Advanced Research, Volume 2, No 2 (2013)
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ABC Journal of Advanced Research Blind Peer-Reviewed Journal
Volume 2, Number 2/2013 (4th Issue)
Contents
1.
Socio-Business Consideration of Garment Workers in Bangladesh: A Statistical Review
8-17
Naiem Jalal Uddin Ahmed; Ms. Nasima; & Naznin Alam (Track: Business) 2.
Investors‘ Perception for Transforming Traditional Stock Market into Islamic Stock Market: An Empirical Study on Dhaka Stock Exchange
18-29
Md. Saheb Ali Mondal; Nazma Akter; & Mohammad Afsar kamal (Track: Business) 3.
HIV/AIDS Risk among the Children of Bangladesh: An overview Nasrin Zahan
4.
30-43
(Track: Sociology)
Lessons from Mahatma Gandhi for Today‘s School Principals: An Instructional Model
44-54
Samuel O. Obaki; Anthony Sang; & Paul Ogenga (Track: Sociology) 5.
Economic Globalization, Income Inequality and Economic Growth in Nigeria: A Static Data Analysis
55-68
Ogunyomi, Oluwatosin Olatunji; Daisi, Olusegun Richard; & Oluwashikemi, Rasaq Adebola (Track: Economics) 6.
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Socio-Business Consideration of Garment Workers in Bangladesh: A Statistical Review Naiem Jalal Uddin Ahmed1; Ms. Nasima2; & Naznin Alam3 1
Assistant Professor, Department of Business Administration, Stamford University Bangladesh Lecturer, Department of Business Administration, Stamford University Bangladesh
2&3
ABSTRACT RMG sector is the most influential economic contributory sector in Bangladesh. Fifty percent and more revenue in GDP approximately are generated from this sector. Therefore, it is very much important to analyze the socio-business consideration of garment sector in Bangladesh. So far, since 80‘s garment industries had been booming in Bangladesh. These types of industries face challenges and take the advantage over different opportunities throughout more than three decades. Here, this paper suggested that the socio-economic as well as the business-statistical review of the garment industries in Bangladesh by providing some field research. This paper attempted to provide an overview of the industry in monitoring, standard of living, mix assessment and compliance (which is provided by foreign buyers) aspects. Keyword: RMG, GDP, Garment Industry
INTRODUCTION The Readymade Garments (RMG) sector ensures labor rights, labor standards, fair labor practices and a Code of Conduct in garment industries. This sector has a greater potential than any other sector to poverty reduction in Bangladesh. RMG sector has been becoming important in terms of employment, foreign exchange earnings and its contribution to Gross Domestic Product (GDP) gradually. Poor working conditions in the factories, lack of social compliance, and lack of security are serious concerns in the present situation of Bangladeshi garment industries since 2006. Compliance is defined as code of conduct, specification and or standard that must be followed by business organizations. Now it has led to labor unrest and damage to institutions and property as well as the valuable human lives. As a result, the garment industries now have become a potential discussed factor in Bangladesh. Hence, the readymade garments (RMG) sector is now facing a decline in demand. Recently the US government suspended Bangladesh from the Generalized System of Preferences (GSP). GSP allows dutyfree entry of over 5,000 goods to the US market from least developed countries like Bangladesh. This action is taken because of the failure to improve working conditions in the country by the Bangladesh government. The probable financial loss in terms of falling export seems very small in the short run. Now Bangladesh exports about $5 billion worth of goods where mostly RMG products to the USA are every year. Therefore, the suspension from US GSP will account for a fall in export of about 0.8 % for Bangladesh.
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Undoubtedly, the garments industry has a significant impact in the economy and image of Bangladesh. The garments industry is one of the two major foreign exchange generating sources, the other being remittance from expatriates. It is also providing employment to huge number of people especially women in Bangladesh who account for 90 percent of the work force in this industry. Due to the conservative norms and values that exist in the country, women are not able to work in all kinds of industries. The RMG sector has provided an excellent opportunity for them to get employment, bringing a significant change in the demographics of the workforce of the country. The employment opportunities in this sector are encouraging farmers in rural areas to discontinue farming and to join the garments industry. Women are leaving their employment in the informal sector where they mostly worked as housemaids. Facing hardship and poverty, these women who are often illiterate or having less than primary level education come to urban areas in search of work in garments industries for better living conditions. Many will argue that the living standards of the laborers are still below average, but we must say that after having job in RMG sectors they are living a better life than they used to live before. In addition to the economic contribution of the readymade garments sector, the expansion of this industry has caused noticeable social changes by bringing more than 1.12 million women into labor force. It has given women the chance to be financially independent and have a voice in the family because now they can contribute financially. This economic contribution as well as empowerment of women has changed their status in the family. Most importantly, RMG sector produces a group of entrepreneurs of those a sizable number is female. A woman entrepreneur established one of the oldest export oriented garment factories named ―Baishakhi Garments‖ in 1977. Many women are now holding top executive positions in RMG industry. One of them named Bibi Rasel is very much popular for her fashion house known as ―Bibiyana‖ in Bangladesh. Thus, RMG sector is not only contributing in earning foreign currencies but also creating employment opportunities for women that in turn can contribute in the socio-economic development of Bangladesh. Therefore, it is very much essential to assess the status of women workers in RMG sector to take appropriate strategies for facilitating as well as ensuring their rights so that this sector will become more convenient for them. This will encourage the women and provide them the opportunity to contribute in the development of Bangladesh. In Bangladesh, the government had declared that the minimum salary of a garment worker would be 5500 taka. However, recently the higher authorities of the garment industries have declared to pay 5300 taka per employee. According to ―International Trade Statistics‖ (2013) of World Trade Organization, Bangladesh is 8th in importing textile. In 2012, our country has imported 584 crore-dollar textile. Therefore, we can say the RMG sector is very much important to make our country internationally renowned.
LITERATURE REVIEW RMG sector is the most profitable sector in Bangladesh. In many research papers, we see the negative sides of this sector. However, we know that this situation can be changed. Now, working conditions in the RMG sector are now making their standard better. Here, workers suffer various kinds of diseases due to the unhygienic environment also a number of workers are killed in different accidents like fire hazard and panicking. We have lost so many lives and we feel responsible for that. The international organizations have seen how cordial the people are to get rid of this horrible situation. Day by day, this situation is changing. As RMG sector is an important foreign exchange earning component so this
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type of inappropriate mechanism should be eradicated for protecting workers‘ rights and maintaining their safety. According to Qudus, Rashid and Dasgupta; the working conditions in this sector frequently violate international labor standards, and Codes of Conduct (Quddus, M. and Rashid, S.; 2000 and Dasgupta S., 2002). Alam (2004) suggested that regularity and strict monitoring by the government agency could overcome security problems of garment workers in Bangladesh. Sometimes, women workers face physical abuse and sexual harassment inside as well as outside the factories. Now, management is more concerned about the security of women workers. According to Kumar, garment workers are concerned with long working hours or double consecutive shifts, personally unsafe work environment, poor working conditions, wage and gender discrimination. In addition, the higher authorities treat the RMG workers as slaves, exploiting workers to increase their profit margins and keep their industry competitive to compete internationally (Kumar A., 2006). In Bangladesh, recruitment policies are highly informal because there is no a written formal contract or appointment letter. Hence, the workers have to lose their jobs at any time. However, fear of losing their jobs and lack of alternative job opportunities makes them unsatisfied (Bansari, 2010). As it is a very important sector to gain foreign currencies, so they should be given appointment letters. Now it is becoming more formal to join a garment factory than before. According to Morshed, the key role of Cambodian labor unions in the RMG sector and as mediator‘s between workers and factory owners to settle disputes and discuss wages (Morshed, 2007). As per government‘s decision now in Bangladesh the higher authorities of garment industries are also going to pay 5300 taka per employee, which is much better wage than before. Now it has become regular incidents to injure, disable and dead from fire and building collapses in different garment factories (Majumder P, 1998), which is not desirable. People are now becoming more and more conscious day by day on this regard. The government, NGOs, international agencies, buyers and other stakeholder groups should work together with mandatory requirements as specified in the law, which is now happening. Hence, it is true that NGOs, civil society, trade unions and other stakeholders should work together to adopt the Code of Conduct for a viable and competitive RMG industry (Khan, 2006). On the basis of the ―International Trade Statistics‖ by World Trade Organization, Bangladesh has become 8th for importing textile as in the previous year 584 crore-dollar textiles are imported (2013). This literature review indicates that RMG sector of Bangladesh is now paying more attention to labor rights and unsafe working environment than the past. Consequently, many international buyers now demand orders from Bangladeshi garment industries. Therefore, an effective initiative (making labor wage up to 5500 taka) by the government in this regard has provided a basis for negotiating with buyers.
OBJECTIVE OF THE STUDY The objective of this study is to explicate the socio-business consideration of garment worker in Bangladesh with the help of different statistical measures and scale.
DATA & VARIABLES 1. Source of Data Fifty-three garment workers of five garment industries in Bangladesh fill up the questionnaires. The name of the garment industries are Dragon Garments, Dina Garments, Khalil Garments, Opash Garments and Chondropuri Garments.
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2. Variables The variables are name, age, designation, salary, level of education, working experience in year, security, training and average working hour. Among them ―name‖ and ―designation‖ are string variables and others are numeric. There are 53 garment workers in this research. The data of the first variable ―name‖ is written according to the names in the questionnaires. Among them the first 10 workers are from Dragon Garments, the next 13 are from Dina Garments, the next 10 are from Khalil Garments, the next 10 are from Opash Garments and the last 10 are from Chondropuri Garments. The third variable ―designation‖ is labeled as 1 = line chip, 2 = supervisor, 3 = floor manager, 4 = cutting master, 5 = worker, 6 = operator, 7 = ironman, 8 = guard and 9 = manager. The design masters are included in 4. The helpers are included in 5. The general manager (GM) and other managers are included in 9. The fifth variable ―level of education‖ is labeled as- 0 = no education, 1 = before SSC, 2 = SSC pass, 3 = HSC pass, 4 = more than in HSC. The seventh variable ―security‖ is labeled as 1 = good, 2 = medium, 3 = bad. The eighth variable ―training‖ is labeled as- 0 = no, 1 = yes. The ninth variable ―average working hour‖ is labeled as 1 = less than 10 hour, 2 = 10 hour and more. The data of other variables are written according to the questionnaires. 3. Software and Technical Support This study is conducted through the following packages of software: SPSS 17.0; MS Office 2007.
RESULTS & ANALYSIS 1. Descriptive Statistics There are no missing values in the data set. From descriptive statistics, we can see thatthere are 53 cases. The minimum values for age, salary, level of education, working experience in year, security, training and average working hour are 15, 2500, 0, 0.4, 1, 0 and 1 respectively. The maximum values are 52, 60000, 4, 20.0, 3, 1 and 2 respectively. The mean (average) values for garment workers are 26.98 years of age, 9560.38 Taka salary, education is up to SSC pass (2.34), 3.821 years of experience, medium security (1.45), training given to 50 % workers (0.53) and average working hour is 10 hours or more (1.83) respectively. That means on average the age of a garment worker is approximately 27 years. The average salary of a garment worker is approximately 9560 taka. The average level of education is SSC pass. Average working experience is approximately 4 years. The proper security given in the garment industries is medium on average. The training for better security is given to on average 50 percent workers. Finally, on average the workers have to maintain 10 hour and more working time. The standard deviations (variation of the values) for garment workers are 7.102 years of age, 10168.850 Taka salary, and education stopped before SSC (1.372), 3.4527 years of experience, medium security (0.748) is given, training given to 50 % workers (0.504) and average working hour is less than 10 hour (0.379) respectively. That means the total dispersions of the values are these results. The descriptive statistics is given in the appendix section (Table 1.1). 2. Frequency Tables The individual frequency tables are given here for age, designation, salary, education, experience, security, training and average working hour respectively.
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At first, in table 1.2 the frequency distribution of ―age‖ is given. The variable is labeled after recoding as 1 = less than 20 years, 2 = 20-30 years and 3 = 30 years and above. Here six people are aged less than 20 years, the maximum thirty five people are aged 20-30 years and 12 are aged 30 years and above. In table 1.3 the frequency distribution of ―designation‖ is given. The value labels of the variable ―designation‖ after recoding are 1 = worker, 2 = supervisor, 3 = guard and 4 = authority. Here the maximum forty-one people are general workers, four are supervisors, two are guards and the rest six people are higher authorities. In table 1.4 the frequency distribution of ―salary‖ is given. The variable ―salary‖ is labeled after recoding as 1 = less than 5000 taka, 2 = 5000-10000 taka and 3 = 10000 taka and above. The maximum twenty two people get less than 5000 taka as salary, seventeen people get 5000 to 10000 taka and fourteen people get 10000 taka and above. In table 1.5 the frequency distribution of ―education‖ is given. The variable ―education‖ is labeled as ―level of education‖. The value labels are 0 = no education, 1 = before SSC, 2 = SSC pass, 3 = HSC pass and 4 = more than HSC. Here two workers have no education, the maximum twenty people stopped their education before SSC, six people are SSC pass, eight people are HSC pass and seventeen are more than HSC passed. In table 1.6 the frequency distribution of ―experience‖ is given. The variable ―experience‖ is labeled after recoding as ―working experience in year‖. The value labels are 1 = less than 6 months, 2 = 6-12 months and 3 = 12 months and above. The maximum forty-eight people have less than 6 months experience, three get 6 months to 1-year experience and two get more than a year experience. In table 1.7 the frequency distribution of ―security‖ is given. The variable ―security‖ is labeled as ―how is the security?‖. The value labels are 1 = bad, 2 = medium and 3 = good. Thirty-seven people says they get bad security, eight people says they get medium and another eight says they get good security. In table 1.8 the frequency distribution of ―training‖ is given. The variable ―training‖ is labeled as ―if security training is given‖. The value labels are 0 = no and 1 = yes. Here we see that twenty-eight people say training is given for security and another twenty-five say they do not get any training. Obviously, the training is not fruitful enough. In table 1.9 the frequency distribution of ―average working hour‖. is given. The variable is labeled after recoding as ―average working hour‖. The value labels are 1 = less than 10 hr and 2 =10 hr & more. Nine people work less than 10 hour. Definitely, they are seniors. The maximum forty-four people work more than 10 hour that include general workers. All frequency tables are given in the appendix section.
RECOMMENDATIONS Condition of Garment workers in Income and Economic sectors Garment workers are poorly paid in this sector. Because of sustained campaigning by women workers, women rights and human rights activists and other trade unionists in Bangladesh, the minimum wage for garment workers was raised in 2010 for the first time in four years. Receipt of wages in the garment industry depends on meeting an assigned production target. If production targets are met, a sewing operator‘s salary now starts at 3,861 taka (approximately £32) a month and a helper‘s wage at 3,000 taka (£25) a month. This amount is inadequate in meeting the minimum living standards in the urban areas. Besides the above, they get no other benefits or festival allowances. Recently the
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higher authorities of the garment industries have declared to pay 5300 taka per employee in spite of the government‘s decision of paying 5500 taka. Women workers are employed in poorly paid jobs facing severe lab our rights violations and do not get their legal entitlements. They are also forced to work at night often exceeding 10 working hours that is a violation of the labor standard. Condition of Garment Workers in Social-political sectors Garment workers are also disadvantaged socially and politically. As for example, they face problem in the areas of accommodation, transport, and access to health treatment. Most of them are living in the urban slums and they have no access to government social protection measures like VGD and VGF cards in rural areas. Women workers have no right to form labor/trade union and therefore politically they have no power and voice to bargain with the factory owners. Existing situation also deter them from getting involved in any right based activities for their well-being. Condition of Garment Workers in Training sector To provide proper training to workers, supervisors and managers in the RMG sector to improve their capacity. Training is always considered as an effective instrument for upgrading skills and raising efficiency of human resource, which eventually ensures increased productivity. The entrepreneurs of the relevant sector but much more needs to be done have taken some initiatives. Necessary steps should be taken by both the public and the private sectors, and development partners to establish appropriate fashion and technology institutes. Improvement in working conditions and organizational environment can also result in increased productivity, which eventually renders these enterprises more competitive. Condition of Garment Workers in Security sectors In 24 September 2013 nearly 3.5 million garment workers in Bangladesh, recently faced industrial accidents and a staggering loss of life. They should get essential support to improve working conditions, strengthen labor inspection and upgrade building and fire safety at their workplaces and by providing training to workers, supervisors and managers in the RMG sector to improve their capacity to ensure workplace safety including the prevention of violence. One of the solutions central to the safety issue may be worker empowerment, at Rana Plaza where they were forced to work, despite imminent collapse reported on TV news the previous day. Entrepreneurs have to provide and to ensure a safe working environment for the workers where they can exercise their rights fully and satisfactorily. Recent tragedies in Dhaka‘s garment industry have highlighted the importance of improving safety standards and ensuring protection for factory workers. Condition of Women Workers in Maternity leave and Child Care Facility Bangladesh Labor Law guarantees all women workers a total of 16 weeks‘ paid maternity leave and in January 2011 the Prime Minister announced that maternity leave would be extended to six months. However, most women workers have little knowledge of their rights or of the necessary applications to employers or the doctor‘s certificates needed in order to claim those rights. The majority end up being fired by their employers when they become pregnant or sent on leave without payment. As a result many women are forced to work during the final stages of pregnancy in order to make ends meet, jeopardizing the health of both mother and child.
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Most of married women workers have to spend a big amount of time separated from their children due to long timework. Although Bangladeshi Labor Law requires every establishment with more than 40 women employees to provide a suitable room or rooms for the use of children under the age of six. The majority of women workers in the garment factories have no option but to send their children to stay slum house or to send their parents in rural areas, due to lake of child facilities in their workplace, depriving them of the right to breastfeed and of the enjoyment of bringing up their own children. If there is more time and funding then in depth analysis can be done.
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Appendix Table 1.1: Descriptive Statistics Variables N Minimum Maximum
Mean
Std. Deviation
age
53
15
52
26.98
7.102
salary
53
2500
60000
9560.38
10168.850
level of education
53
0
4
2.34
1.372
working experience in year 53
.4
20.0
3.821
3.4527
53
1
3
1.45
.748
if security training is given 53
0
1
.53
.504
1
2
1.83
.379
how about the security? average working hour
53
Valid N (listwise)
53
Table 1.2: Frequency Distribution of “age” Frequency Percent Valid Percent Cumulative Percent Valid
less than 20 years
6
11.3
11.3
11.3
20-30 years
35
66.0
66.0
77.4
30 years and above
12
22.6
22.6
100.0
Total
53
100.0
100.0
Table 1.3: Frequency Distribution of “designation” Frequency Percent Valid Percent Cumulative Percent Valid
worker
41
77.4
77.4
77.4
supervisor
4
7.5
7.5
84.9
guard
2
3.8
3.8
88.7
authority
6
11.3
11.3
100.0
Total
53
100.0
100.0
Table 1.4: Frequency Distribution of “salary” Frequency Percent Valid Percent Cumulative Percent Valid Less than 5000 tk
22
41.5
41.5
41.5
5000-10000 tk
17
32.1
32.1
73.6
10000 tk & above
14
26.4
26.4
100.0
Total
53
100.0
100.0
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Table 1.5: Frequency Distribution of “education” Frequency Percent Valid Percent Cumulative Percent Valid
No education
2
3.8
3.8
3.8
Before SSC
20
37.7
37.7
41.5
SSC pass
6
11.3
11.3
52.8
HSC pass
8
15.1
15.1
67.9
HSC a & above
17
32.1
32.1
100.0
Total
53
100.0
100.0
Table 1.6: Frequency Distribution of “experience” Frequency Percent Valid Percent Cumulative Percent Valid Less than 6 months
48
90.6
90.6
90.6
6 months to 1 year
3
5.7
5.7
96.2 100.0
More than 1 year
2
3.8
3.8
Total
53
100.0
100.0
Table 1.7: Frequency Distribution of “security” Frequency Percent Valid Percent Cumulative Percent Valid
Good
37
69.8
69.8
69.8
Medium
8
15.1
15.1
84.9 100.0
Bad
8
15.1
15.1
Total
53
100.0
100.0
Table 1.8: Frequency Distribution of “training” Frequency Percent Valid Percent Cumulative Percent Valid
Yes
25
47.2
47.2
47.2
No
28
52.8
52.8
100.0
Total
53
100.0
100.0
Table 1.9: Frequency Distribution of “average working hour” Frequency Percent Valid Percent Cumulative Percent Valid Less than 10 hr
9
17.0
17.0
17.0
10 hr & more
44
83.0
83.0
100.0
Total
3
100.0
100.0
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Investors’ Perception for Transforming Traditional Stock Market into Islamic Stock Market: An Empirical Study on Dhaka Stock Exchange Md. Saheb Ali Mondal1; Nazma Akter2; & Mohammad Afsar kamal3 1
Assistant Professor of Accounting, DBA, International Islamic University Chittagong, Bangladesh Assistant Professor of Accounting, DBA, Northern University Bangladesh, Bangladesh 3 Senior Lecturer, DBA, Uttara University, Bangladesh 2
ABSTRACT Muslim investors should concern not only about maximizing profits but also be aware about the justification of Islamic guidelines and invest to whose stocks which are shariah compliant. The severity of the current market fall as well as financial crisis has shaken the foundations of the capitalist financial and capital market system and has led to search for ideas and solutions. So it is imperative to explore all possible approaches that enhance the process of mobilizing Islamic financial resources and expanding shariah compatible investment like investment in Islamic stock market. This paper is few attempts that identify some failures of conventional stock market as well as favorable position of Islamic stock market and investors‘ perception regarding the topic. Study covers 201 respondents to collect data and analyze it by using five point Likert scale. This study found that investors feel to get separate Islamic stock market with Islamic shariah and principles but not to transfer traditional stock market into Islamic stock market. The study revealed that they desire to get stable and minimum risk market for Islamic stock with halal income whereas they want to make more profit anyhow from the existing market preferably. Key words: Islamic stock market, Stock market, Shariah principles, Investors’ perception, Shariah compliant and non compliant stock.
STATEMENT OF THE PROBLEM Islam is a subject of unconditional option instead of mandatory and most of the people of our country are Muslims but their vital economy not depends on Islam. Moreover they do not consider absolutely practice in Islam, social welfare, shariah rules and regulations, equity based security, interest or riba, separate Islamic market, risk and return. In the case of Bangladeshi investors who seek to invest in shariah compliant stocks, interest rate is therefore not a determining factor. According to Prophetic saying ―Islam has strictly admonished any deliberate pushing up of prices whether through monopoly or najash (pushing the prices up without actually intending to buy)‖. While the studies on conventional stock market are proliferating in the recent decades, less attention is being
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given to its Islamic counterpart. In convention market, there are several determinants of the share price movement that can drastically change the stock market scenario and most of them are prohibited in lslam but in order to make the stable Islamic market, there may have only one factor that should be principle of Islam. Investors should examine and take into account, where they invest and which one is appropriate for the earth and hereafter. The establishment of Islamic stock markets will be benefited for the investors, issuers and intermediaries as well as the country as a whole. Mobilization of resources is needed to finance development projects in Muslim countries; the structure and scope of the Islamic stock market as well as its problem of raising funds require an in-depth examination in the light of the shariah. Islamic economists contend that Islamic finance has an alternative that would prevent the recurrence of a similar crisis, whereas the principles of Islamic finance have much to offer to bring out a stable financial system and capital market. Based on the literature review, there has been no study conducted on the implication of Islamic stock market in Bangladesh. This study attempts to fill this gap and suggest that investors should see how they will earn money from the market in the light of maqasid al shariah. The objective of this study is to critically examine the fact that whether the investor of DSE follow the determinants affecting stock price under Islamic frame work and to formulate the investors perception for considering Islamic concept instead of existing traditional market. Researchers tried to get the perception of investors, are they feel to convert existing stock market in Dhaka Stock Exchange into Islamic Stock Market or not? The study found that most of the respondents follow the shariah prohibited factors to invest and they are not fully agreed to transfer this market to Islamic stock market but feel to lunch separate Islamic stock market. But their behavioral approaches are not behind the Islam, hopefully, they want to get maximum benefit from Islamic market without having Islamic stock market. This study tries to furnish some concrete suggestions and recommendations towards the development of a full-fledged Islamic stock market.
LITERATURE REVIEW Literature review presents previous research findings regarding existing market problems and prospects of Islamic stock market. In case of loan ratio, SEC changed directive of margin loan ratio by increasing it from 1:0.5 to 1:1 on 13th December 2010 and later it was again hiked to 1:1.5 & 1:2 because of free fall of share prices (Bhuiyan, 2011). Hossain (2011) criticized ―this time liable factors are omnibus account, placement share, book building method, rumors and so on. Misuse of those factors causes the capital market debacle‖. According to M. Shamsul Haque professor of finance and Vice Chancellor, Northern University Bangladesh (2012) ―Combination of wrong information to the investors, illegal participation of banks and institutions in the stock markets, weak accounting functions are at the core of the crisis that saw billions of Tk. wiped out‖. Bangladesh government commissioned a committee consisting of four members led by Mr. Khondkar Ibrahim Khaled (chairman) to find out individual or institution involved in the recent share market crash. The committee submitted a report consisting of the reasons for the crash and recommendations with couple of case studies on 7th April, 2011. The report has identified a group of manipulators including key officials, auditors, issuers, issue-managers, brokers, individual investors and some other stakeholders. According to the investigation report (2011) of the probe committee, reasons for the stock market crash are following: role of market regulators and their employees; demutualization of exchanges; investment of bank in the capital market; pre-IPO & IPO process; uniform face value of share;
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placement trade / kerb market; omnibus account; asset revaluation & rumor; book building method; direct listing; block placement; suspicious transaction of top players; issue of right and preference share; serial and artificial trading. So we can say that Dhaka stock exchange is not in right track. Sangit Saha (2012) found that over exposure of banks & financial institutions is the most important reason behind the crash where 15 respondents selected the cause. Then poor monitoring of regulators was found 2nd important reason for the crash chosen by 12 respondents. Corrupted employees of regulators, Margin loan were chosen by 11 respondents and direct listing & insider trading was selected by 8 respondents. Interest rate volatility affects the conventional stock market volatility but not the Islamic stock market volatility. And they stated that there is no evidence of significant time varying risk premium for both convention and Islamic stock returns (Mohd. Yusof and Abd. Majid, 2006). Risk free interest rate element can be influenced by the changes in money supply and thus affecting the expected return of a financial asset. An increase in the interest rate reduces stock prices and eventually the returns. They suggest that investing in Islamic stocks provides higher returns although it has almost similar risk to the conventional stock market. (Mohd. Yusof and Abd. Majid, 2007). Investors who seek to maximize profits trend to be more sensitive towards changes in interest rates. For Turkish stock market, higher interest rate affects the stock market volatility for the period 1988-1995 Muradoglu et al. (1999). Shiller (2003) urged, for higher returns can sometimes lead to moral hazard behavior that can ‗encourage people to engage in destructive rather than productive acts‘ . Chapra (2008) attributes the crisis to inadequate market discipline resulting from lack of using profit-loss sharing modes of financing, expansion of the size of the derivatives, and the policy of ‗too big to fail‘. He calls for a ‗new architecture‘ to prevent occurrence of similar crises. Siddiqi (2008) identified the root cause of the crisis as ‗a moral failure that leads to exploitation and corruption‘. He identified credit (liquidity) crunch, over-extended leverage, complexity of the products, and speculation and gambling (risk shifting) as the main features of the crisis. Coval and Stafford (2007) said that although stocks are fungible, fire sales have been shown to happen also in stock markets because other investors may not have sufficient buying capital when selling pressure is highest and capital is a low moving or because the stocks sold may have different characteristics from their preferred set. Habib(2009) revealed the key factors causing the crisis can be identified at three levels: a deregulated environment, financial institutions engaged in excessive risk-taking (to reap higher profits), and the use of innovative complex products. Sarah Gooden (2011) Generally speaking the key principle in Islamic finance is the need to achieve justice. The aim therefore is to avoid injustice to a party in a transaction. These include prohibitions against jahala (ignorance) and garar (speculation). Whilst it is acknowledged that it is impossible to remove all speculation or uncertainty from commerce, the intention is that avoidable elements of speculation should be removed and parties should be clear on the upon which they have agreed to do business. These principles mean that gambling & many types of derivatives contracts, many forms of insurance, unfair advantage & income from objects that are forbidden for a Muslim are not permitted under Shariah law. Abdul Rahman Yousri Ahmed (1995) state that there are three conditions for a security to be Islamic: i. to be committed to the conditions of profit and loss sharing in a clear, unequivocal stipulation on the legal rules governing the mudarabah and partnership contracts necessarily but not sufficient. ii. Resources mobilized through these securities (issued on non interest basis) should not be rechanneled to institutions not functioning in conformity
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with Shari‘ah and to firms dealing with interest in all their activities by using Islamic bank. Without sharing in the risk of this return, such returns are nothing but interest and the term profit is merely a misnomer just for covering it up. iii. The funds mobilized through these securities should be utilized in priority projects that clearly fulfill the public interest of the Muslim society and should not invest non Muslim foreign countries. Robbins (2010) stated that in the post-financial crisis would economy, there will be opportunities for new financial products to develop in response to both crisis and its regulatory fallout. The principles of Islamic finance may be just what are needed in this trying economic time, with an emphasis on morality, fairness and aversion to excessive risk, these foundational premises can teach conventional finance a few helpful lessons. The key will be to find ways to translate Islamic finance‘s underlying goals and methods to a large audience in the non Muslim world. Samad & Hassan (1999) found that BIMB (Bank Islam Malaysia Berhad) is relatively more liquid and less risky compared to a group of 8 conventional banks. A true Muslim will not consider it a great sacrifice when he parts with his surplus liquidity because Islam urges him to invest his idle balances in productive activities which may benefit the Islamic society, yet he will not hesitate to seek the optimal investment opportunities likely to provide him with a better yield. Therefore, the best securities to a Muslim are those issued (a) by ventures serving the objectives of Islamic economic activity, (b) projects expected to yield higher returns, (c) the Muslim buyer who acquires them will not feel embarrassed to take advantage of price changes through the sale of securities in his possession or repurchasing them later on for the benefit of achieving windfall profits from this transaction as long as (i) he is not linked whether as a major or secondary contributor, to the price changes which he would have taken advantage of, and (ii) he has concluded the transaction in accordance with the terms set out by the security issuing party. Brooks (2009) asserts that ‗an economy is a society of trust and faith‘ and ‗every recession is a mental event‘ and ‗has its own unique spirit‘. Secondary securities markets in most Muslim counties are almost non-existent, or where they exist, are unorganized, or are regulated by laws and regulations that do not allow sufficient dynamics required to achieve their objectives, especially if we take into consideration the nature of the institutions that dominate them. Islamic capital market means where investment and financing activities and products are structured in accordance with shari‘ah principles. Bursa Malaysia's definition is (taken from the Islamic Capital Market, p. 2): "The Islamic Capital Market (ICM) refers to the market where activities are carried out in ways which doesn‘t conflict with the principles of Islam. Therefore, it is of utmost importance to analyze the Shari‘ah appraisals on the existing stock market in to see if it is permitted in Islam, or totally prohibited, or allowed with certain modifications of existing share and bond of DSE. The classical literatures on Islamic jurisprudence include the basic Shari`ah principles for financial transactions like prohibition of Riba, gambling, AlGharar, coercion, cheating and the Shari`ah rulings for partnership business and various types of contracts and the legal maxims for issuing Fatwa in the new issues. (See Ibn Taymiyah, 1999). Fahd have explained in detail the permissibility of a share market in Islamic Shari`ah but the other parts related to the share market are absent in their studies. Fahd (2007) argued that the share of a company is perfectly legal and that there is no prohibition whatsoever for establishing share market in Islam. (Zaky, (1992) asserts that the ordinary share is lawful, but the preferred share is not, as he says: ―while investment in ordinary shares is perfectly lawful, investment in preferred share is not‖. (p. 71)
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METHODOLOGY The nature of the study is descriptive and empirical. Primary data have been collected throughout the structured questionnaire from the 201 respondents randomly from the different brokerage houses which have been selected on the basis of purposive sampling in the Dhaka city. Most of the investors were not interested to response even they had fear and insulting mode. After collecting the data researchers used Five point Likert scale and Cronbach‘s Alpha test for analysis. Likert five points scale used an equal weight of each length in the study, used degrees as follows: not influenced, slightly influenced, moderately influenced, influenced and strongly influenced. The highest grade given 5 degrees, the lowest grade given one degree, the degrees sorted in descending order (1, 2, 3, 4, 5). Secondary information has been taken from the data base of DSE. Total 301 companies listed up to march-2013 in DSE which has outstanding common share to the investors and study identified how many companies are Islamic on the basis of shariah board or product and services. Treasury stock, preferred stock and bond & debenture are not considered to analyze because of their shariah non compliant character.
RECOGNIZED PROBLEMS OF DHAKA STOCK EXCHANGE Dhaka Stock Exchange establishes and executes rules and regulations to conduct all the activities smoothly & efficiently and control them properly and timely on the basis of conventional approach. But Dhaka stock exchange failed to run & control smoothly and efficiently due to some problems and most of them undoubtedly, prohibited in Islam. Researchers found some problems which were causes the big crash of DSE and can be summarized as: gambling; insufficient and inefficient monitoring; euphoria of investment in shares; prospect of quick capital gains; existence of kerb market; absence of proper application of circuit breaker; lack of skilled manpower and their inhuman behavior; price manipulation; delays in settlement; irregulations in dividends; selection of membership; improper financial statement; the intrinsic values of the securities; the absence of comprehensive legal and supervisory framework; the lack of proper policy framework that provides incentives and protections; government forms the institutional sources rather than the market; not well developed and weak form market; political involvement; illogical involvement of bank & other funds which are responsible for pushing the market to speculative activities. Delivery versus payment mechanism was used as one of the main vehicles of manipulation. Other reasons: profits & sales slipping; authority does not hold required shares; top executives leave the company; a famous investor sells shares of the company; an analyst downgrades his recommendation of the stock, may be from "buy" to "hold"; other stocks in the same industry go down; shortage of share supply, a big lawsuit is filed against the company; some new law might hurt sales or profits and a powerful company enters the business. These problems are identified on the basis of literature but most of them are inconsistence with Islamic law and shariah, this is why the study tried to focus investors‘ perception to transfer this market into the Islamic stock market for betting the existing problems as much as possible.
WHY AND HOW ISLAMIC STOCK MARKET IN DHAKA STOCK EXCHANGE? Investors‘ Islamic values and morality depend upon the Islamic economy as well as total Islamic environment. Therefore creation of an Islamic values and morality of the investors and common Islamic stock market is the desire of the muslim investors. And of course, it
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will be efficient and sound for trading Islamic stocks and to invest in profitable and shariah compliant securities and instruments. In order to get minimum or equal risk and stable market, what are the dealings and transactions that are required to give life to the market to identifying the "permissible" transactions in the light of maqasid al shariah? It is Islamic stock market but stock market based strictly on Islamic principles is still in the early stages of its evolution especially in Bangladesh. To do this, we need a sound Islamic money market and various Islamic companies and after that investors can get the Islamic stock as well as market. The first step in establishing an Islamic stock market would be to rid the conventional system and riba, or interest. A systematic understanding of stocks from Islamic perspective is necessary, but, without having an Islamic shariah or shariah advisory council we can‘t touch the uplifting position, even to start. So we must look at the shariah board or shariah advisor council before trying to establish any legal actions. Moreover, this development based on Islamic principles are based on the interpretations of shariah is part of an ongoing process. Others aim to help the harmonization of Islamic accounting standards; to build a halal income source from stock; increasing degree of integration and to create attraction to invest among Muslim countries. According to shariah, gambling is forbidden as stated in the Holy Quran. It is true that people are not willing to take a greater degree of risk except against a greater amount of expected return but gambling profit is not a reward for that. Islam has strictly admonished any intentional pushing up of share prices through gambling. As for safeguarding the market and the Islamic economic activity against illegal price speculation, Islamic stock market may be the solution of removing all the causes which lead to it. Therefore, it is one of the functions of an Islamic secondary market to eliminate speculation and to impose tight controls non-shariah price speculations. Islamic stock market requires an equity based securities not debt-based securities. But equity based security does not indicate purely Islamic or shariah-compliant stocks. Shariahcompliant in Islamic perspective, if their business activities are not related to prohibited activities as outlined by shariah scholars. The prohibited business activities include: alcohol, gambling, pork-related products, pornography, conventional financial services, conventional insurance, weapons, hotels or entertainment depending on the methodology. Shariah, a framework of ethical guidelines or a set of principles that says you cannot be investing in industries which are harmful to one's self or to the society. Investors of Dhaka stock exchange are investing in companies that engage in financial services based on riba (interest), manufacture or sale of non-halal products or tobacco-based products or related products, gaming and gambling, conventional insurance, and non-compliant entertainment services, stock broking or share trading in shariah non-compliant securities and other activities deemed non-permissible according to shariah. The establishments of an Islamic secondary stock market will not come out as a natural development in the existing economy. Actually it would be the output through Islamic studies regarding its laws, regulations, objectives, functions and by the desire of the investors and respective authorities. Islamic laws, regulations and objectives can formulate easily than its functions. Operational functions are more wide and complex to run and control. In the functions, Islamically oriented projects are expected to increase and it to be obtained by entering to the financial market directly through launching their own securities to cover their long-term financing requirements. Some Islamic banks, insurances and financial institutes have already taken this step of getting into the financial market and have issued securities that would enable them to response to the needs of projects seeking growth.
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But these attempts are like a drop of water in the river in Bangladesh economy. However, this trend is expected to increase in future within the need for a shariah-based security. There should have the capability to translate the relevant part of the Islamic shariah into the form of essential regulations and systems to the investors that would contribute to set up a secondary stock market which will be capable of meeting the challenges of our modern life. They should also have enough human expertise with some shariah scholars to run the activities of this market successfully and to ensure that it would not deviate from fulfilling the shariah objectives and the greater interests of the Muslim ummah. Islamic capital market fact finding report (2004): Islamic scholars consider two additional criteria to select a company whether it is permitted or not with activities comprising both permissible and non-permissible elements: (a) The public perception to the company must be good; and (b) The core activities of that are important and considered maslahah (benefit in general) to the Muslim ummah (nation) and the country as well, and the non-permissible element is very small, difficult to avoid and the rights of the non-Muslim community which are accepted by Islam. In addition to the business activities criteria, certain jurisdictions use financial ratios as additional criteria in classifying shariah stocks. Other than business and financial criteria, some jurisdictions are known to also apply a cleansing mechanism to purify investments that are tainted by prohibited activities and that should goes to the charitable fund or baitulmal as shariah non compliant income. In our country, there is no Islamic economy by law and practice. So financial institute and listed company of DSE cannot avoid interest and few other things which are imposed by the government to the system of economy. Although the product or company is shariah compliant but financial and money market instruments, systems, laws and practices are not totally permissible to Islamic shariah. Neutral stock or partial Islamic stock means that those share are not absolutely haral or haram. Islam permitted those shares by trading and prohibited to take any kind of dividend. In those companies main business or end-product are halal but they borrow money on interest, also they invest some of their money on interest. Means, their business is mixed with interest. So there should have some tolerable limit of mixed contributions from permissible and non-permissible activities towards turnover and profit before tax of a company. In these regard, qualified shariah scholars fixed the benchmark and if the contributions from non-permissible activities exceed the benchmark, the securities of the company will be classified as shariah non-compliant. The benchmarks are: a. the five-percent benchmark: This benchmark is used to assess the level of mixed contributions from the activities that are clearly prohibited such as riba, gambling, liquor and pork. b. The 10-percent benchmark: This benchmark is used to assess the level of mixed contributions from the activities that involve the element of ―umum balwa‖ which is a prohibited element affecting most people and difficult to avoid. An example of such a contribution is the interest income from fixed deposits in conventional banks. This benchmark is also used for tobacco-related activities. c. The 20-percent benchmark: This benchmark is used to assess the level of contribution from mixed rental payment from shariah non-compliant activities such as the rental payment from the premise that involved in gambling, sale of liquor etc. d. The 25-percent benchmark: This benchmark is used to assess the level of mixed contributions from the activities that are generally permissible according to shariah and have an element of maslahah to the public, but there are other elements that may affect the shariah status of these activities. Among the activities that belong to this benchmark are hotel and resort operations, share trading, stock broking and others, as these activities may also involve other activities that are deemed non-permissible according to the shariah. Purely Islamic common stock or shariah compliant stock & warrants may be considered as shariah non compliant stock if company change totally or partially its operations and objectives or due to other causes.
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On the other hand, if existing market is transferred to Islamic stock market and, or company changes its functions and objectives then shariah non compliant stock may be the shariah compliant stock. There will have some criteria that investors should follow. In this case what principles investors should follow is stated by distinguish shariah scholars and shariah advisory council which are as follows: (i) Shariah-compliant securities but changes in the companies‘ operations or due to certain reasons are subsequently considered shariah non-compliant. In this regard, the value of the securities held exceeds the original investment cost from effective date; investors who hold such shariah noncompliant securities must liquidate them and any capital gains arising from the disposal of the shariah non-compliant securities can be kept by the investors. But any excess capital gains derived from the disposal after effective date should be channeled to the charitable fund or baitulmal. (ii) investors who invest based on shariah principles to dispose of any shariah non-compliant securities which they presently hold, within a month of knowing the status of the securities. Any gain made in the form of capital gain or dividend received during or after the disposal of the securities has to be channeled to charitable bodies or baitulmal. The investor has a right to retain only the original investment cost. With some specific regulations, existing securities will also be applicable to the Islamic markets and new stocks will have Islamic rules completely at the time of lunching. National shariah council is necessary to formulate for the Islamic financial money markets and capital markets. The Securities Commission and shariah council will work closely with the industry to encourage the introduction and promotion of new products according to Islamic shariah and advice them how to overcome the obstacle. Government, SEC and other respective authority should organize talk show, exhibition, seminar & symposium and other promotional activities that will produce educational materials to the different target groups and it will help the existing and prospective investors to invest & generate halal income from the market. The buildup of Islamic stock market and extended it to both regionally and internationally may be the opportunity of getting leading position in the world.
ANALYSIS AND FINDINGS Islam is a way of life that can bring an alternative and create a healthy environment to the stock exchange. The resources are for the benefit of all, not just a few. So everyone must acquire resources rightfully and in accordance to the Quran and the Sunnah. But investors in DSE commonly do not follow those principles right now. The researchers made an effort to furnish investors‘ perception regarding the study object whether they are interested to invest into the Islamic stock market with accepting shariah law or not.
EMPIRICAL ANALYSIS Ranking of investors perception vary from one another. In this case, the investors perception regarding shariah rules & regulations and separate Islamic stock market take place 1st position which are about 3.49 score. It indicates, Investors perception is negative to transfer conventional stock market into Islamic stock market and they are influenced to use separate Islamic stock market with shariah rules and regulations for that. They desire to get Islamic product and instrument and equity based security at the same time they like to enjoy interest but it opposite direction to others, both obtained 3rd position with 3.19 scores. It means that they have no appropriate concept of Islam or they want to get maximum benefit from both principles. From the table, study revealed that shariah advisor obtained 6th position which means investors moderately influenced with the
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necessity of shariah advisor for separate Islamic stock market. Islamic stock market would be less risky and provide secured return and shariah principles is compulsory for that which obtained 2.93 scores with bearing the meaning of moderately influenced. However, they have given priority to Islamic stock market, gambler involvement in the market, preferred stock, brokerage service and debt securities with scores 2.81, 2.76, 2.57 and 2.48 respectively which include strength and weakness of the stock market. Lastly, transforming existing market obtained last rank with a score 2.28 which means they are not influenced to transfer existing stock market to Islamic stock market. On the basis of five point Likert scale study claims that Investor has given priority about separate Islamic stock market with Islamic law; shariah council where there will be no interest and gambler and they are not influenced to transfer existing conventional market to Islamic stock market. Cronbach Alpha reliability test Reliability Statistics Cronbach's Alpha N of Items .655 40 Determining the reliability of data analysis is essential to ensure the trustworthiness of the study. Cronbach's alpha is a coefficient of internal consistency to estimate of the reliability of the statistical outcome from data and indicates inter correlations among test items with reliability of test scores. This study is based on primary data and most of the questions were commonly unfamiliar to the investors. So measurement of reliability is essential and Alpha Cronbach provides accurate internal consistency estimation and reliability. Table shows that the reliability coefficient is 0.655. In other words, the overall questions are about 65.5% reliable and 34.5% unreliable which means reliability statistics is acceptable. There is no strong internal consistency among the test items. The study had argued that there are two views to poor consistency among the items. Investors want to get the benefit of Islamic stock market but they are used to make illogical and unethical profit from existing traditional market with a shorter period and want to continue it drastically. Summary of Islamic & non Islamic shares in DSE Basis Total shares Islamic in DSE shares Shariah Board 301 15 Products & Services 301 165 Source: DSE database.
Non Islamic shares 286 136
% of Islamic shares 4.98 54.82
From the above table, we see that total listed companies are 301 in Dhaka stock exchange which have the common stock. On the basis of shariah board 15 companies are Islamic which indicates 4.98% of total stocks. So it has no significant number of Islamic stocks to start Islamic stock market. The study claims that, every organization should take necessary step to establish shariah board or shariah advisory council to make it Islamic company. But in view point of product and services 165 companies are Islamic which indicates 54.82% of the total shares. This number would be significant if we want to start Islamic stock market. However, only shariah board or Islamic products and services are not only the measurement scale to identify the Islamic stock but also it must cover the shariah requirements. More clearly, shariah based stock should be interest free and in accordance with shariah law and Islamic product and services should have shariah board and interest free in accordance with shariah law. Nevertheless, we are not free from interest perfectly, so these outcomes will not come naturally and without any cost. If government can establish money market without interest and with Islamic environment then we will get Islamic stock but Islamic stock market will be so far and depends on the investors‘ willingness and moral behaviour.
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CONCLUSION On the basis of investors‘ perception, they have no intention to transfer this market into Islamic stock market, but they want to enjoy all the opportunities of Islamic stock market .i.e. they want to get benefit without any cost. The researchers want to make conclusion in a way of that for getting all Muslims final out comes, market should be transferred into Islamic stock Market. But this is not possible because of investors demand and our economic environment, capital & money market, and rules & regulations which are existing to use exchange or trade. However, most of the prerequisites for a natural birth of such a market do not exist at present. Therefore, endeavors should be made for their realization and revolution that will help for setting up such a secondary Islamic stock market. Customers are always right and priority should be given for them. So investors‘ expectation can change the present market or establish a separate Islamic stock market. If investors want to get Islamic environment; Islamic money and stock market; interest free transaction; gambling & other illogical factors free market, they can get it because they are the driving factor to do this and government should honor to fulfill investors demand by the help of SEC & DSE. In this situation, we need to win the confidence of people in the securities issued on an Islamic basis, and persist in infiltrating the present conventional stock markets with a view to Islamizing their activities. Even it will be caused of creating a better climate for Islamic stock and a gradual transformation into an Islamic stock market. But it can only be achieved when the shariah-based investment projects realize actual success by the help of Muslim investors. Recent and early stock market crash ask to search the way how to overcome these problems & need to know the right path (as a Muslim) of trading shares. This study has revealed that owners of the outstanding share desire to get shariah rules & regulations; separate Islamic stock market; shariah compliant products & services and equity based securities priority basis. But they are not intended to transfer existing stock market. Reliability test of Cronbach Alpha coefficient claims that the test variable items are accepted. Therefore, respective authority & government may go to start separate Islamic stock market with the help of 15 shariah based Islamic stock and 165 product & service view Islamic stock. Here, researchers mention one thing that investors want to get separate Islamic stock market but they do not want to dump traditional stock market. It may be the indication of getting Islamic stock market test with having traditional market & whenever they will prove the superiority of Islamic stock market over traditional with maximum profit from stable Islamic stock market, then they will accept it, unless they will continue traditional stock business. The study believes that, if separate Islamic stock market is not established by the government, individual and other responsible authorities, as a Muslim we cannot solve the issues of halal and haram from the stock business. The study argues that Islamic stock market adopts a dynamic approach towards the development of just, sound, less risky and ethically balanced stock market. No doubt, this type of market can incorporate many products of the conventional stock market directly or with some modification of its features and functions and prohibits others. The Muslim government, companies, agencies and the intellectual Muslim investors should play its due role to establish Islamic stock market as to face the challenges of the conventional interest and gambling based security market.
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RECOMMENDATION The international financial crisis has set the stage for Islamic finance to demonstrate a genuine alternative global financial system with halal and moral values. Study may conclude about the investors‘ perception that investors want to get separate Islamic stock market not to transfer existing stock market. Islamic securities can be the opportunities to issue, purchase and for trading benefit to the economy. In this regards, Dhaka stock exchange hopefully may make a list of shariah compliant stock that lead to start an Islamic stock market for local and foreign Muslim investors. Finally Islamic stock market is the consequence of some activities that must be act together. To make a complete Islamic stock market we need Islamic stock and that is the innovation of Islamic shariah based company. Islamic company depends upon the Islamic capital market which is the part of Islamic economy. However we cannot imagine Islamic economy if there is no shariah board, Islamically government and Islamic rules & regulations. Moreover, investors are the driver of the economy and if, they have no Islamic concept in thinking and practice, all the attempts will be worthless. Needless to say that to improve the investors‘ perception to introduce Islamic stock market would require an academic effort and field work by a full research team for a considerable period of time. However as a Muslim government, they should train up the investors by providing Islamic concepts, rules and regulations under the control of shariah board. As participating organizations either full fledged or ‗window‘ basis, brokerage house can play the vital role in accordance with shariah principles to carry out the Islamic stock broking business to the separate Islamic stock market. Last but not least government should take necessary actions to make separate Islamic market by which investors can make their investment to the Islamic stock market or to the conventional market according to their desire. Next study may be conducted on how government can establish separate Islamic stock market or how much superior Islamic stock market will have over traditional market.
REFERENCES [1] [2] [3] [4] [5] [6] [7]
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Ahmed, H (2009). Financial Crisis: Risks and Lessons for Islamic Finance ISRA International Journal of Islamic Finance 1(1). Brooks, D (2009). An Economy of Faith and Trust. New York Times. Chapra, U (2008). The Global Financial Crisis and the Islamic Financial System. Paper presented at the Forum On The Global Financial Crisis, Islamic Development Bank. Coval, Joshua & Stafford, Erik, 2007. "Asset fire sales (and purchases) in equity markets," Journal of Financial Economics, Elsevier, vol. 86(2): 479-512. Fahd Bin Abdur Rahman Al-Yahya. 2007, At- Takyif Al-Fiqhi Li as-Saham fi Ash-Sharikat AlMusahamah Wa ‗Asruhu, Daru Kunuji Isbilia, Riyadh Gooden, S (2011). Islamic Finance and its application in Housing Projects. Housing Finance International PP 43-49. Haque, M. S., (2012). Recent stock market crash in Bangladesh. [Internet], Available from:< http://www.nub.ac.bd/recent-stock-market-crash-in-bangladesh-wrong-signals-fromresponsible-quarters-since-the-ctg-caused-the-asset-price-bubble/> [Accessed April 29 2012]. Helly E Robbins(2010). Soul searching and profit seeking. Texas Law Review Vol.88 1125-1150 Hossain M. K., 2011. Securities And Exchange Commission Annual Report 2010-11. Ibn. Taymiyah, Ahmad Bin Abdul Halim. 1999, Al-Qawa‘id An Nuraniyyah, Dar al- Ma‘rifah, Beirut. Islamic capital market fact finding report (2004), Report of the Islamic capital market task force of the international organization of securities commissions. Khaled K. I., 2011. Investigation report of Probe Committee.
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[13] [14] [15]
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Mohd. Yusof, R. and Abd. Majid, M.S. (2006). Policy and Persistence of Stock ReturnsVolatility: Conventional versus Islamic Stock Market. Journal of International Business and Entrepreneurship.Vol. 12(1): 49-68. Mohd. Yusof, R. and Abd. Majid, M.S. (2007). Stock Market Volatility Transmission in Malaysia: Islamic versus Conventional Stock Market. Isalmic Economic Journal King Abdul Aziz University.Vol.20(2): 17-35 Muradoglu, G. Berumet, H. and Metin, K. (1999). Financial Crisis and Changes in Determinants of Risk and Return: An Empirical Investigation of an Emerging Market (ISE). Multinational Finance Journal. 3(4): 223-252. Rahman, A and Ahmed, Y (1995). Islamic securities in Muslim countries' stock markets and an assessment of the need for an Islamic secondary market. Islamic Economics Studies, 3(1): 47. Robert J Shiller (2003) From efficient markets theory to behavioral finance, Journal of economic perspectives 17 (1): 83-104 Samad, A and Hassan, M, K (1999). The performance of malaysian Islamic bank during 19841997: an exploratory study, International Journal of Islamic Financial Services 1(3): Sangit Saha (2012) Stock market crash of Bangladesh in 2010-11: Reasons & roles of regulators thesis paper page 50 Shahjahan H Bhuiyan (2011). Social Capital and Community Development: An Analysis of Two Cases from India and Bangladesh Journal of Asian and African Studies 46 (6): 533-545 Siddiqi, M. Nejatullah (2008). Current Financial Crisis and Islamic Economics. Mimeo, Oct 31. Zaky,Nublan Zky Dato Yusoff Zaky(1992). An Islamic perspective of Stock Market-An Introduction, Dian Darulnaim Sdn. Bhd.Malaysia. page 71
CALL FOR PAPER American Journal of Trade and Policy (AJTP) is an open-access, peer-reviewed interdisciplinary journal which seeks articles from any broad theme of international trade. AJTP features reports on current developments in international trade as well as on related policy issues. The digital online version is published by AJTP, and the hard copy (print) version is published by Asian Business Consortium (ABC). Web: www.ajtp.us
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Engineering International (EI) is a peerreviewed multi-disciplinary international journal devoted to academic advanced research from the engineering arena. It specializes in the publication of comparative thematic issues as well as individual research articles, review essays, and book reviews. Committed to disseminating rigorous scientific research to the widest possible audience, EI is fully and freely accessible on line. Web: www.j-ei.us
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HIV/AIDS Risk among the Children of Bangladesh Nasrin Zahan Lecturer, Department of Applied Sociology, ASA University Bangladesh, Bangladesh
ABSTRACT Everyday more than thousands of people are becoming infected with HIV/AIDs worldwide nearly half of them are women. According to the joint United Nations Program on HIV/AIDs (JNAIDs) â&#x20AC;&#x2022;2010 Report on the Global Aids Epidemicâ&#x20AC;&#x2013;, 2.5 million children around the world are living with HIV/AIDs. Most HIV infections are passed from mother to child during pregnancy. Bangladesh as a developing country, in spite of resource scarcity, has been operating some significant policy initiatives with the active role from both governmental and non-governmental bodies to prevent and mitigate the impact of the epidemic in the families. Though there is, no notable program running in Bangladesh especially for children developed awareness as well as preventing them from HIV and AIDS. This Study reviews current knowledge of mother-to-child HIV transmission in developing countries, summarizes key findings from the trials, outlines future research requirements, and implementing prenatal HIV prevention interventions in resource-poor settings. Successful implementation of available prenatal HIV interventions could substantially improve global child survival. As for this, to formulate a complete strategy and action plan in both national and local level for this alarming issue is an utmost necessity. Key words: HIV infection, HIV/AIDS Targeted Intervention (HATI), Mother to Child Transmission (MTCT), HIV Epidemic, Peer education, Sexually Transmitted Disease (STD), Migrant workers, Pregnant Women, People living with HIV/AIDS (PLHIV).
INTRODUCTION As a global issue, over twenty-five years into the AIDS (Acquired Immune Deficiency Syndrome) epidemic, like other groups the children in their path remain at grave risk. Basic statistics shows, at the end of 2010, an estimated 34 million people were living with HIV worldwide, up 17 percent from 2001. This reflects the continued large number of new HIV infections and a significant expansion of access to antiretroviral therapy, which has helped reduce AIDS-related deaths, especially in more recent years. Although Bangladesh continues to be a low prevalence area, it is surrounded by high prevalence countries (High prevalence of HIV/AIDs in neighboring India). We however must not adopt a complacent attitude in respect as our country has all the determinants for an explosive outbreak of HIV/AIDs epidemic. Curses of poverty, illiteracy, ignorance, proximity of Bangladesh to
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the so-called ‗Golden Triangle‘ & high prevalence of STDs, make our country seriously vulnerable. Moreover, the intravenous drug users (IDU) are the potential carriers of HIV/AIDs among the vulnerable groups in the country. Everyday a large number of people cross border movement take place both officially and illegally. Due to reason of that, great chance to spread out HIV/AIDs in Bangladesh. AIDS is a chronic illness caused by infection with HIV (Human Immunodeficiency Virus). HIV is transmitted through exchange of certain bodily fluids such as blood, semen, vaginal secretions, and breast milk. To produce an infection, the virus must pass through the skin or mucous membranes into the body. HIV infection occurs in all age groups. Twenty-five percent of the babies born to untreated mothers infected with HIV develop HIV infection themselves. Many of these children die within one or two years, but some live for years, although their development is slowed and they can get many infections. Mothers-to-be with HIV must get special treatment to try to prevent transmission of the virus to their fetuses. New treatments for pregnant women may reduce the transmission of the virus to less than one in ten babies of HIV-positive mothers. Drug and/or alcohol abuse, premature and/or promiscuous sexual activity are serious risk behaviors. Evaluation by a child and adolescent psychiatrist can be the first important steps in helping a family respond effectively high-risk behaviors in their children and adolescents (Forsythe, Siegel, Nyamete, 1996). Today adolescents of both sexes face a serious risk of HIV infection, which is the cause of AIDS in most developing countries. Despite growing understanding and awareness, HIV infection is a serious threat to both heterosexual and homosexual teens. When adolescents take certain risks, they are more prone to become infected with HIV and develop AIDS.
HIV AMONG CHILDREN According to UNAIDS (The Joint United Nations Program on HIV/AIDS) at the end of 2010, an estimated 3.4 million children worldwide under age 15 years were living with HIV/AIDS. Approximately 1.8 million children under age 15 years had died from the virus or associated causes in that year alone (UNAIDS, 2011). As HIV infection rates rise in the general population, new infections are increasingly concentrating in younger age groups. About 1,000 babies were infected with HIV every day during pregnancy, birth or breastfeeding. (http://unicef.org)
CAUSES OF HIV/AIDS AMONG CHILDREN HIV/AIDS infections in children are passed from mother to child during pregnancy, labor and delivery, or breastfeeding. In 2009, an estimated 370,000 children contracted HIV during the prenatal and breastfeeding period, down from 500,000 in 2001, according to the JNAIDS report. Beside this, blood transfusions using infected blood or injections with unsterilized needles can lead to HIV infection and AIDS among children. Although sexual transmission is not a main cause of HIV/AIDS among children, it does occur in countries where children become sexually active at an early age. Children may become infected through sexual abuse.
MOTHER TO CHILD TRANSMISSION (MTCT) OF HIV/AIDS If a pregnant woman is infected with HIV, she can transmit the virus to her baby during pregnancy. An intervention known as ―prevention of mother-to-child transmission of
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HIV‖ (PMTCT) provides drugs, counseling and psychological support to help mothers safeguard their infants against the virus. Ensuring PMTCT is provided to all women that need it is our most effective way to end mother-to-child HIV transmission by 2015, and reach the UN‘s Millennium Development Goal 6. Ensuring that no baby is born with HIV is an essential step towards achieving an AIDS-free generation. Too far a few pregnant women and their infants have access to this preventive treatment. In the United States, approximately 25 percent of pregnant HIV-infected women not receiving AZT therapies have passed on the virus to their babies (UNAIDS 2008a). The rate is significantly higher in developing countries. In many communities, countries and regions of the world, however, access to services to halt MTCT needs to be scaled up. In 2009, UNAIDS called for the virtual elimination of mother-to-child transmission of HIV by 2015. ―Globally, 45 percent of HIV-positive pregnant women are now receiving treatment to prevent them passing HIV on to their children, with an increasing rate since 2005,‖ said Ann M. Veneman, UNICEF Executive Director. Children are adversely affected by the impact that HIV and AIDS has on country‘s essential services. One of the most important services that children need is healthcare. In areas heavily affected by AIDS, the large number of patients that they have to look after often overwhelms hospitals. In many cases, these hospitals have lost staff to AIDS, making it even more difficult for them to cope. Providing adequate care for sick children is made all the more difficult with a health system heavily burdened by the HIV epidemic in vulnerable countries like Bangladesh and other developing states.
PREVENTING MOTHER-TO-CHILD TRANSMISSION (MTCT) OF HIV Women who have reached the advanced stages of HIV disease require a combination of antiretroviral drugs for their own health. This treatment, which must be taken every day for the rest of a woman's life, is also highly effective at preventing mother-to-child transmission (PMTCT). Women who require treatment will usually be advised to take it, beginning either immediately or after the first trimester. Their newborn babies will usually be given a course of treatment for the first few days or weeks of life, to lower the risk even further. In 1994, a landmark study conducted by the Pediatric AIDS Clinical Trials Group (PACTG) demonstrated that AZT, given to HIV-infected women who had very little or no prior antiretroviral therapy and CD4+ T-cell counts above 200/mm3, reduced the risk of MTCT by two-thirds, from 25 percent to 8 percent. In the study, AZT( Ziduvudine) therapy was initiated in the second or third trimester and continued during born labor, and infant were treated for 6 weeks following birth. Later on according to Kisumu Breastfeeding Study and MITRA PLUS, study shows maternal triple drug therapy to decrease MTCT to further down to around 5 percent. Long-term follow up of the infants and mothers is ongoing. A few years later, another PACTG study found that the risk of transmitting HIV from a HIV-positive mother to her newborn infant could be reduced to 1.5 percent in those women who received antiretroviral treatment and appropriate medical and obstetrical care during pregnancy. Combination therapies have been shown to be beneficial in treating HIV-infected adults, and current guidelines have been designed accordingly. The AZT regimen is not available in much of the world because of its high cost and logistical requirements. The cost of a short-course AZT regimen is substantially lower, but is still prohibitive in many countries included Bangladesh, India, Nepal and Malaysia. International agencies are studying whether there may be innovative ways to provide
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AZT at lower cost, for example, through reductions in drug prices to developing countries or partnerships with industry. As a result, NIAID continues to evaluate other strategies that may be simpler and less costly to prevent MTCT in various settings. In September 1999, one study demonstrated that short-course therapy nevirapine lowered the risk of HIV-1 transmission during the first 14 to16 weeks of life at nearly 50 percent compared to AZT in a breastfeeding population. As a follow up, NIAID released a final report on additional data showing that the results nevirapine were sustained after 18 months. These findings have significant implications because this simple, inexpensive regimen offers a potential cost-effective alternative for decreasing MTCT in developing countries. Under the 2010 guidelines of WHO, all HIV positive mothers, identified during pregnancy, should receive an extensive course antiretroviral drugs to prevent mother to child transmission. If these extensive drugs are not available, then the WHO 2006 recommended course might be an option and a woman should begin taking AZT after 28 weeks of pregnancy (or as soon as possible thereafter). During labor, she should take AZT and 3TC, as well as a single dose nevirapine. Her baby should receive a single dose nevirapine immediately after birth, followed by a seven-day course of AZT. The mother should continue taking AZT and 3TC for seven days after delivery, to cut the risk of drug resistance still further. WHO says that PMTCT programmes are "strongly encouraged" to implement the 2010 recommendations but acknowledges that this might not be possible for all countries. In this situation, there are previous regimens that have been used and might be implemented, these options are shown in the table below. Table-01 WHO guidelines for PMTCT drug regimens in resource-limited settings Pregnancy Labour
2010 Recommendations option A (WHO/UNAIDS/ UNICEF,2011) 2010 Recommendations option B (WHO/UNAIDS/ UNICEF, 2011)
2006 Recommendations
After birth: After birth: infant mother
(If mother breastfeeds) Daily nevirapine (NVP) Single dose Zidovudine syrup until 1 week after Zidovudine nevirapine (AZT) and breastfeeding has finished. (AZT) after (NVP) and lamivudine (If using replacement 14 weeks lamivudine (3TC) for feeding) Daily NVP or (3TC) seven days AZT until 4-6 weeks of age. Triple Triple ARVs after ARVs 14 weeks
Triple ARVs until 1 week after breastfeeding has finished
Single dose nevirapine Zidovudine (NVP), (AZT) after zidovudine 28 weeks (AZT) and lamivudine (3TC)
zidovudine (AZT) and single dose nevirapine lamivudine (NVP) and zidovudine (3TC) for (AZT) for seven days seven days
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4-6 weeks of daily nevirapine (NVP) syrup or daily zidovudine (AZT) syrup, regardless of feeding method.
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Alternative (higher risk of drug resistance)
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Zidovudine single dose (AZT) after nevirapine 28 weeks (NVP)
Minimum (less effective)
-
Single dose nevirapine (NVP), zidovudine (AZT) and lamivudine (3TC)
Minimum (less effective; higher risk of drug resistance)
-
single dose nevirapine (NVP)
single dose nevirapine (NVP) and zidovudine (AZT) for seven days
zidovudine (AZT) and single lamivudine (NVP) (3TC) for seven days single (NVP)
dose
nevirapine
dose
nevirapine
Source: http://.avert.org Under the 2006 recommendations, if a woman receives at least four weeks of AZT during pregnancy, doctors may choose to omit her dose nevirapine from the recommended regimen. In this case she will not have to take 3TC during labour, or to take any drugs after birth. However, her baby must still receive nevirapine, and should also receive AZT for four weeks instead of one. If the woman receives less than four weeks of AZT during pregnancy then her baby should receive AZT for four weeks instead of one.
GROWING UP WITH THE HIV EPIDEMIC Children and young adults currently between the ages of 15 to 24 years were born and grew up as the first generation to experience childhood during the HIV/AIDS epidemic (Bernard van Leer Foundation, 2006). Today it is among this same population of 15 - 24 years old that new HIV infections are concentrated. According to recent United Nations estimates, near about half of the 16,000 new HIV infections, which occur daily, are within this age group. An additional 10 percent of new infections occur among children under age 15 years. Since the virus was first identified in 1981, more than 3 million children have been born HIV positive and the mothers of over 8 million children have died from AIDS. The effects of HIV and AIDS on children who are orphaned, or in families where parents are living with the virus, not only include these calculable losses, but also the immeasurable effects of altered roles and relationships within families. Clearly, HIV infection has its greatest impact on the young. The proportion of women living with HIV has remained stable at 50 percent globally, although women are more affected in sub-Saharan Africa (59 percent of all people living with HIV) and the Caribbean (53 percent) (UNAIDS 2011). Regionally we see that Sub-Saharan Africa remains the region most heavily affected by HIV. In 2010, about 68 percent of all people living with HIV resided in sub-Saharan Africa, a region with only 12 percent of the global population and the Caribbean has the second highest regional HIV prevalence after sub-Saharan Africa. However, the rate of HIV prevalence is substantially lower in Asia than in some other regions, the absolute size of the Asian population means it is the second largest grouping of people living with HIV. In Bangladesh, the overall prevalence of HIV in populations must at risk remains below 1 percent (NASP, 2011).
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Table -02 Regional Statistics for HIV & AIDS, end of 2010 Adults & Adults & Adult Adult & child Young people (15– children children prevalence death due to 24) prevalence (%) living with newly infected AIDS HIV/AIDS Male Female
Region
Sub-Saharan Africa
22.9 million
1.9million
5.o%
1.2 million
1.4
3.3
North Africa & Middle East
470,000
59,000
0.2%
35,000
0.1
0.2
South and South-East Asia
4.2 million
270,000
0.3%
250,000
0.1
0.1
East Asia
790,000
88,000
<0.1%
56,000
<0.1
<0.1
OCEANIA
54,000
3300
0.3
1600
0.1
0.2
1.5 million
100,000
0.4%
67,000
0.2
0.2
200,000
12,000
0.9%
9,000
0.2
0.5
Eastern Europe & Central Asia
1.5 million
160,000
0.9%
90,000
0.6
0.5
North America
1.3 million
58,000
0.6%
20,000
0.3
0.2
840,000
30,000
0.2
9900
0.1
0.1
34.0 million
2.7 million
0.8%
1.8 million
0.3
0.6
Latin America Caribbean
Western Central Europe Global Total
&
Source: UNAIDS (2011). During 2010 more than two and a half million adults and children became infected with HIV, the virus that causes AIDS. By the end of the year, an estimated 34.0 million people worldwide were living with HIV/AIDS. The year also saw 1.8 million deaths from AIDS, despite recent improvements in access to antiretroviral treatment.
HIV/AIDS SITUATION IN BANGLADESH Bangladesh is one of the most densely populated countries in the world. Its population of over 150 million places a tremendous economic, social and environmental strain on the country‘s resources. In spite of development successes in the last three decades, with fertility declining from 6.3 to 2.5 children per women, Bangladesh‘s population is still projected to reach 200 million by 2050. (UNDP, 2008b) Bangladesh is at high risk to the spread of HIV/AIDS, despite its low prevalence among the general population; due to a concentrated epidemic among inject drug users. HIV prevalence is less than 1 percent among high-risk groups. According to the Bangladesh National AIDS and STD (Sexually Transmitted Disease) Program (NASP), the
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number of HIV cases in the country is estimated at 7,500, although the number of cases officially reported is significantly lower (http://unaids.org/pub). By December 2011 there were 2533 reported cases of HIV and 1101 cases of AIDS, as well as 325 AIDS-related deaths (Table:03). UNAIDS estimates that the number of people living with HIV in the country may be around 12,000 (UNAIDS, 2008c). Table: 03 National Summary of the HIV and AIDS Epidemic of Bangladesh As of 2009 New HIV Total HIV
343 1745
New AIDS Total AIDS
2010 As of 2011 As of 2010 2011 445 2088 231
619
New Death
AIDS
Total Death
AIDS 204
2533 251
850 37
1101 84
241
325
Source: (NASP, 2011) The first case of HIV in Bangladesh was detected in 1989; and the last surveillance (9th Round) conducted in 2009-10 found the national HIV prevalence at less than 1 percent, making Bangladesh a low-prevalence country. However, significant levels of risk behavior, such as the formal and informal commercial sex trade, low levels of condom use, and rising HIV-prevalence levels among inject drug users (IDUs) are of increasing concern. An estimated 2.2 to 3.9 million Bangladesh nationals are considered to be at higher risk of acquiring HIV, including drug users, female sex workers and their clients, men who have sex with men (MSM), and internal and cross border migrants (World Bank and UNAIDS, 2009). In addition, there is sufficient evidence of high rates of HIV transmission to wives from their migrant husbands after their return from abroad. More than 80 percent of the diagnosed HIV positive people are migrant Bangladeshi workers and their wives (Southasia, 2008). Other documented proofs, include unsafe practice in health service, unprotected sexual practices, increasing number of homosexuality and low patronage of condoms. According to a NASP study, most of the men in the study population do not use condom in their commercial sex encounters. Likewise, female sex workers report the lowest use of condom in the region [only 0 to 12 percent of the different groups of sex workers recorded that they use condom with new clients] (Daily Star, 2010).
NATIONAL RESPONSE TO HIV/AIDS IN BANGLADESH The government of Bangladesh (GOB), from the very beginning, has taken an evidence-based approach towards HIV programming. Prevention programs have been scaled up among sex worker, IDUs, MSM and hijra. The government of Bangladesh responds to HIV and AIDS from the first case detected in 1989, GOB formed National AIDS Committee (NAC), Technical Advisory Committee (TAC), the AIDS policy and National AIDS/STD Program (NASP). The
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NASP is one of the wings of Directorate General of Health Services (DGHS) under the Ministry of Health & Family Welfare (MOHFW) responsible for coordinating with all stakeholders and development partners involved in HIV/AIDS program activities throughout the country. There are several policy documents developed to guide the national HIV and AIDS program intervention. NAC comprises national experts from various disciplines, including parliamentarians, representatives from key ministries, and NGOs. NASP is responsible for coordinating with all stakeholders and development partners involved in HIV and AIDS programming. Based on the National Policy on HIV/AIDS, the five year (1997-2002) Strategic Plan for the National AIDS Program of Bangladesh focused on issues related to HIV/AIDS and sexually transmitted infections (STI), with emphasis on safe blood transfusion protocols. The implementation of the third National Strategic Plan for HIV/AIDS Program (2011-2015) is currently underway. The goal of the third national strategic plan is, to minimize the spread of HIV and minimize the impact of AIDS on the individual, family, community, and society. The GOB also developed the National Advocacy and Communication Strategy (2005-2010) in collaboration with all relevant government ministries, NGOs, the UN, and other development agencies. The policy identified priority groups for HIV intervention as sex workers, IDUs, MSM, mobile populations (immigrant, people regularly crossing borders, transport workers, factory and other mobile workers), prisoners, uniformed forces, and street children. The multi-sector response to HIV/AIDS in Bangladesh has broadened beyond the Health Ministry to include all sectors of government. Efforts have yielded a variety of strategic action plans for NASP, defined fundamental principles, and provided the framework for a national response. The national response is supported by specific guidelines on a range of issues, including testing, care, blood safety, and HIV prevention among youth, women, migrant workers, and commercial sex workers. The Ministry of Health, through the National AIDS Committee, conducts general mass HIV prevention campaigns using electronic and print media. Bangladesh is well positioned to avert an HIV epidemic through strategic, effective, and quick interventions among vulnerable groups engaging in high-risk behaviors as well as among the general population, including women and youth. Without strategic interventions, it is estimated that prevalence in the general adult population could be as high as 2 percent in 2012 and 8 percent by 2025 (Government of Bangladesh, 2008.), but in 9th Round serological report show that the overall prevalence of HIV in populations must at risk remains below 1 percent (NASP, 2011). Table: 04 HIV Programs in Bangladesh Programme Name HIV/AIDS Targeted Intervention (HATI) HAPP HIV/AIDS Prevention Project
Financed by
Funding
Focus Areas
Credit of the International Development Association (IDA) and a grant from DFID DFID and World Bank
US$ 20M 2008 under Health, Nutrition and Population Strategic Plan (HNPSP)
High-risk group interventions: IDUs, sex workers, clients of sex workers ,MSM, Hijra*
US$ 26M
Harm reduction to prevent HIV transmission amongst high risk group: IDUs, sex workers and their clients, MSM, and Hijra
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Global Fund to Fight AIDS, Tuberculosis, and Malaria (GFATM) Bangladesh AIDS Program (BAP)
GFATM Round 2 (2004-2009) Round 6 (2007-2012) Rolling Continuation Channel (RCC), Round 2 (2010-2015) United States Agency for International Development (USAID) (2009-2013)
US$ 80M
--
United Nations other donors
US$ 20M
and
US$ 12.7M
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Youth HIV prevention targeting interventions among high-risk groups: sex workers, IDUs, workplace programs Targeting the most-atrisk groups: IDUs, female sex workers, clients of sex workers, MSM, transgender and their sexual partners Technical support, capacity building, and policy development
* Transgender Sex Workers Source: World Bank and UNAIDS, (2009).
MIGRATION AND HIV/AIDS POSITIVE PARENTS IN BANGLADESH The linkage between migration and HIV for migrant workers and their families is now of growing concern in Bangladesh. According to the International Centre for Diarrheal Disease Research, 47 of the 259 new HIV cases reported during the period 2002-2004 were migrants. Of these, 29 were returning males from abroad, 7 were wives of migrant workers, and 4 were children of HIV-positive migrant workers. Data from the NASP in 2004 showed 57 of 102 newly reported HIV cases were among returning migrants, and the National AIDS STI Program Report of 2006 states that approximately 67 percent of identified HIV-positive cases in the country are returnee migrant workers and their spouses. However, many migrant workers receive their HIV diagnosis from mandatory job-related testing, while the general population is not tested. However, the HIV/AIDS Targeted Intervention (HATI) program includes a package of targeted interventions for external migrants, and migrant workers have been identified as a priority in the Bangladesh National Strategic Plan for HIV and AIDS, 2005-2010. Bureau of Manpower, Employment & Training (BMET) is the only agency that offers pre-departure briefings to migrants on a regular basis incorporating general information on health, including Sexual Transmitted Infections (STIs). However, BMET does not raise any awareness on HIV and AIDS issues, and no linkages between STIs and HIV are established. Private recruiting agencies and the medical centers do not conduct pre-departure briefings on HIV, and consequently migrants go abroad for employment without the necessary information to protect themselves from HIV infection. To reduce the vulnerability of migrants and their families throughout the migration cycle, reliable evidence base is needed that better informs the national response on targeted interventions (USAID-Bangladesh, 2009). Currently, integration of migration and HIV in national policies and programming is limited.
AWARENESS ABOUT HIV/AIDS ON YOUNG GENERATION Human rights are no longer considered peripheral to the AIDS response. Today, the vast majority of countries explicitly acknowledges or addresses human rights in their national AIDS strategies, with 92 percent of countries reporting that they have programs in place to reduce HIV-related stigma and discrimination. Knowledge of the epidemic and how to prevent HIV
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infection has increased among young people aged 15–24 years—people frequently at the highest risk for infection. Young people still lack of knowledge and importantly they need to practice HIV risk-reduction strategies, however. Many people still lack ready access to condoms and lubrication, and people who inject drugs lack sufficient access to sterile needles. From a study in the urban slum area of Dhaka city, found 22 percent boys and 18 percent girls saying that they came to know about HIV/AIDS from their parents, 25 percent boys know about this from their friends/peer group; among the girls, 21 percent know from their teachers. When they were asked whether they knew about the causes and consequences at that moment, they failed to answer so. (Table 05). Table-05 Source of knowing about HIV/AIDS of the respondents Source of knowing about AIDS/HIV Child group (age 15-24) Boys Girls From a friend/peer-group 17 (25%) 2 (4%) From parents 15 (22%) 10 (18%) From local people 9 (13%) 7 (12.5%) From the relative (s) 5 (7.5%) 12 (21%) From the teacher 9 (13%) 12 (21%) From any senior vai/apa 8 (12%) 10 (18%) Doesn‘t know 5 (7.5%) 3 (5.5%) Total 68 (100%) 56 (100%) Source: (Zahan, 2010) Moreover, 26 percent boys said that one of the preventive measures is to avoid the strangers. A good number of boys (22 percent) and girls (32 percent) thought that Kabiraj/Hakim (Traditional Healer) is better for treatment, 2 percent of girls did not know how to safe from it. (Table 06) Table -06 Opinion about their safety from HIV/AIDS Opinion about their safety from HIV/AIDS Child group Boys Girls Need proper guidance 5 (7.5%) 11 (20%) Go to local Kabiraj/Hakim By following the health rules Avoiding the strangers Never mix with the bad guys/friends Learn the direction from TV/Radio/mass media Doesn‘t know/No Answer Total
15 (22%) 14 (21%) 18 (26%)
18 (32%) 13 (23%) 4 (7%)
2 (3%) 14 (21%) 68 (54.8%)
3 (5%) 6 (11%) 1 (2%) 56 (45.2%)
Source: (Zahan, 2010) Table 07 indicates that in January 2012 registered PLHIV of Ashar Alo Society (AAS) in total 1133, among these total 56 are children and in Sylhet region, the rate of children was 28. Moreover, the rate of male registered PLHIV was higher (721) than the rate of others in the
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table; and it is evident from the table that the PLHIV rate was highest in Sylhet area also. Because of, many people of this region work abroad; and from these migrant/foreign living parentsâ&#x20AC;&#x2DC; children has affected by the HIV. Table: 07 Registered PLHIV of Ashar Alo Society* (AAS) (as of January 2012) in Bangladesh Area Male Female Child TG Total Dhaka 149 82 6 6 243 Sylhet 278 123 28 1 430 Chittagong 245 110 20 0 375 Khulna 15 18 1 0 34 Barisal 10 6 1 0 17 Rajshahi 16 5 0 2 23 Rangpur 4 2 0 1 7 other 4 0 0 0 4 Total 721 346 56 10 1133 * Ashar Alo Society is a community based non government registered organization working towards ensuring treatment, care, and support, establish rights, enhance empowerment and greater involvement of people living with or effected by HIV and AIDS (PLHIV) in Bangladesh. PLHIV of Barisal, Khulna, Rajshahi & Rangpur division receive service from Dhaka service centre. In Bangladesh, Care and treatment Centre (CTC) of AAS has provide PMTCT service for HIV positive pregnant women. By January 2012, there are 33 HIV positive pregnant women received care treatment service. Those women were given birth 30 infants within this period. Among 18 of them 17 were identified as HIV negative and one (1) infant identified as HIV positive when they gone under laboratory test after 18 month of their born. The rest of 12 infants are not still complete their 18 month. Beside this, other three women were still waiting for labor and delivery. It is worth mentioning here that these infant were not given breastfeeding and their mothers were under treatment from the beginning of pregnancy. From some case studies, most under aged People Living with HIV & AIDS (PLHA) had to face serious obstacles (i.e. harsh behavior, prohibiting mingling with close peoples and depriving from most normal rights). A limited number of the PLHAs received accurate information and knowledge on HIV & AIDS, positive living and public speaking. In some areas, a small number of organizations like AAS counselors counseled the relatives of the PLHAs through home visit; sensitize her neighbors on HIV and AIDS issue as well as rights of HIV positive people through courtyard meeting (Uthan Boithak). In addition, they received some grant money for alternative livelihood support. After receiving counseling and caregiver training, these relatives are now supportive and caring to the PLHAs. They realized their fault and committed to make sure proper care of the PLHAs.
CONCLUSION AND RECOMMENDATIONS The development of children in any society is determined by the willingness and ability of family and community members to contribute to their successful survival and growth. In the most concrete ways, this includes the provision of food, shelter, clothing, health care, schools and recreational opportunities. It also includes emotional needs such as love, security, guidance, and encouragement. People living in countries where HIV is not widespread like Bangladesh, it can be hard to appreciate how severely some communities have been damaged by the epidemic.
HIV and AIDS policies and strategies specially designed for affected children need to be formulated and implemented with serious monitoring and evaluation at different levels,
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involving both public and private sectors. This will guide policymakers, researchers and practitioners, who are involved in HIV and AIDS activities to respond timely and efficiently in controlling the spread of the misconduct with these people of the community affected by this deadly disease. UNAIDS has declared the framework to mitigate the issue represents a radical departure from current approaches, and has four clear aims (UNAIDS, 2011): 1. Maximizing the benefits of the HIV response 2. Using country-specific epidemiology to ensure rational resource allocation 3. Effective programs based on local contexts 4. Increasing efficiency in HIV prevention, treatment, care and support UNICEF also has declared a four-prolonged strategy to prevent HIV among infants and young children. This includes key interventions to be implemented as a component of overall maternal, newborn and child health services (http://.unicef.org) Prong 1: Primary prevention of HIV among women of reproductive age within services related to reproductive health such as antenatal care, postpartum/natal care, other health, and HIV service delivery points, including working with community structures. Prong 2: Providing appropriate counseling and support to women living with HIV to enable them make an informed decision about their future reproductive life, with special attention to preventing unintended pregnancies. Prong 3: For pregnant women living with HIV, ensure HIV testing and access to the antiretroviral drugs that will help mothers‘ own health and prevent infection being passed on to their babies during pregnancy, delivery and breastfeeding. Prong 4: Better integration of HIV care, treatment and support for women found to be positive and their families. According to the above framework, there are some recommendations in context of Bangladesh. First, arranging Community Support Groups for children and family members who are living with HIV (uninfected family members and affected others), which can provide: emotional support through a forum where family members, including children, can discuss concerns, sharing information and ask Questions a platform for speakers to discuss prevention, care and treatment a focus for educational activities a focus for mutual support and income generating projects a platform for community advocacy and activism. Secondly, providing Services and Assistance to support families affected by HIV/AIDS in ways that enable them to stay together and maintain their home. Such services can be offered by a combination of formal and informal service providers, including government or privately supported agencies, and might include: child or day care by government institutions like, Government Orphanages health and nutritional support by home health care providers Income generating projects or direct financial support like, VGD/VGF, etc. Training for those in the community who interact with HIV/AIDS affected families, offering support to dying parents and their children in future planning. It can reduce the fear and discrimination, which result from misunderstanding and misinformation. Peer education programs involving children work with facilitators in learning about HIV/AIDS in more details form. They design projects, create educational materials, and educate through drama and talks in schools and community meeting places. It encourages confidence and self-esteem in those children and young people. In addition, arranged alternative education strengthens efforts to remove and protect children and adolescents from
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high-risk situations. Finally, consolidate a participatory holistic approach upon existing limited community efforts and assets towards preventing and mitigating HIV/AIDS and build a HIV/AIDS free society for next generation.
REFERENCES [1] [2] [3] [4] [5] [6] [7] [8] [9] [10] [11] [12] [13] [14] [15]
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Ashar Alo Society, Dhaka, Bangladesh, http://www.aas.org.bd/ (Retrieved on 28.02.2012) Bernard van Leer Foundation (July 2006), ‗Where the Heart is meeting the Psychosocial Needs of Young Children in the Context of HIV/AIDS‘, UK. Danziger R. (1994), ‗The social impact of HIV/AIDS in developing countries‘, Social Science and Medicine, vol, 39(7), pp.905-917. Daily Star (2010). Climate change may increase deaths from HIV/AIDS. Available: http://www.thedailystar.net/story.php?nid=137465. Accessed on Feb 27, 2012. De Cock et al (2000) 'Prevention of mother-to-child HIV transmission in resource-poor countries: translating research into policy and practice', JAMA 283(9). Forsythe S, Siegel G, Nyamete A. (1996), ‗The evolution and role of socioeconomic impact assessments in the policy process‖. International Conference on AIDS, 11(2): p402 , New York. Government of Bangladesh, (2008), ‗World AIDS Day Report‘, Ministry of Health and Family Planning, Dhaka. http://unaids.org/pub/report/2008/bangladesh_2008_country_progress_report_en.pdf. (Retrieved on: 12.08.2011) http://www.unicef.org/aids/index_preventionyoung.html, (Retrieved on: 01.03.2012). http://www.avert.org/motherchild.htm , (Retrieved on: 29.02.2012). http://www.niaid.nih.gov/news/newsreleases/2002/Pages/pactg02.aspx, (Retrieved on: 27-02 -2012). http://www.thebody.com/content/art6573.html, (Retrieved on: 28.02.2012). http://asiapacific.undp.org/practices/HIVAIDS/documents/HIV_and_Mobility_inSout h_Asia _web Bangladesh. pdf , (Retrieved on: 12.09.2011). Mahmood SAI (2007), HIV/AIDS in Bangladesh: The Role of Public Health Services in Bangladesh. J. Health. Hum. Serv. Adm., 30: 2. NASP, (2007), report on ‗Global Fund to Fight AIDS, Tuberculosis, and Malaria, Bangladesh HIV Surveillance, 7th Round, Annex – III‘, Ministry of Health and Family Welfare, Government of Bangladesh, Dhaka. NASP (2010), Bangladesh National AIDS and STD (Sexually Transmitted Disease) Program, Dhaka, Ministry of Health and Family Welfare, Government of Bangladesh, Dhaka. NASP, (2011), report on ‗National HIV Serological Serveillance, 2011, Bangladesh, 9 th Round Technical Report, NASP, Ministry of Health and Family Welfare, Government of Bangladesh, Dhaka., available on http://www.bdnasp.net/images/hiv_serological_ surveillance_ report_9th_round_2011.pdf (Retrieved on 25.02.2012) Pediatric AIDS Clinical Trials Group (PACTG), www. pactg.s-3.com, (Retrieved on: 26.02.2012). Zahan, Nasrin, (2010), Reproductive Rights and Women‘s Health: An anthropological study, unpublished Mphil thesis, department of Sociology, Dhaka University, Dhaka. Southasia (2008), Bangladesh: Safe sex and stronger policy for AIDS prevention. Available: http://southasia.oneworld.net/Article/bangladesh-safe-sex-and-strongerpolicy-for-aids-prevention, (Retrieved on: 26.02.2012). .UNAIDS/WHO (2006), ‗Report on the global AIDS epidemic‘, http://www.unaids.org/globalreport/, (Retrieved on 22.12.2010) UNAIDS (2008a), 'Report on the global AIDS epidemic', available on http://www.unaids.org/globalreport/, (Retrieved on 18.09.2011)
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[23] UNAIDS (2008b), ‗epidemiological Fact Sheet on HIV and AIDS‘, Dhaka, available on http://www.unaids.org/bd, (Retrieved on 18.09.2011) [24] UNAIDS (2008c), Inter-Agency Task Team on Education, ‗Teachers Living with HIV', New York. [25] UNAIDS (2009), ‗Children and HIV/AIDS‘ Medicines Sans Frontiers (2006, July), fact sheet. New York. [26] UNAIDS (2010), ‗GLOBAL REPORT: UNAIDS Report on the Global AIDS Epidemic‘, New York, Available on http://www.unaids.org/(Retrieved on: 28.02.2012) [27] UNAIDS (2011), World AIDS Day Report, ―How to get Zero: Faster, Smarter, Better”, New York. Available on http://www.unaids.org/en/targetsandcommitments/eliminatingnewhivin fectionamongchildren/, (Retrieved on: 18.02.2012). [28] UNAIDS, UNICEF, WHO (2008), 'Children and AIDS: Third stocktaking report' , New York. [29] UNAIDS/World Bank Press Release, (11 July 2000), AIDS hindering economic growth, worsening poverty in hard-hit countries, available on www.thebody.com/content/ art641.html, (Retrieved on: 18.09.2011). [30] UNDP (2009), ‗HIV Vulnerabilities Faced by Women Migrants‘. [31] USAID (2004), 'The AIDS Pandemic in the 21st Century', U.S. Agency for International Development and U.S. Department of Commerce, March, 2004, [32] USAID-Bangladesh (2009), ‗Bangladesh HIV-AIDS Follow-on Activity‘, Grants.gov. 38809-001-RFA, Dhaka, [33] WHO/UNAIDS/UNICEF (2009) 'Towards universal access: Scaling up priority HIV/AIDS interventions in the health sector'. [34] WHO/UNAIDS/UNICEF (2011) ‚'Global HIV/AIDS Response: Epidemic update and health sector progress towards Universal Access 2011' [35] World Bank and UNAIDS, (2009), ‗20 Years of HIV in Bangladesh: Experiences and Way Forward‘, Dhaka.
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Lessons from Mahatma Gandhi for Today’s School Principals: An Instructional Model Samuel O. Obaki; Anthony Sang; & Paul Ogenga Masinde Muliro University of Science and Technology, Kenya
ABSTRACT This article presents Mahatma Gandhi‘s leadership styles, ethical principles, and practices that school principals and those aspiring to become school administrators should learn and apply in their schools. The model intends to reinforce the principals‘ understanding the value of applying some of Gandhi‘s leadership styles in Kenyan schools. This theoretical research was based on the existing literature on Gandhi‘s leadership in India and principals‘ leadership including their principles and practices in Kenya. The study found that good leadership in this technologically changing world needs a principal who is innovative, supportive, knowledgeable, people-oriented and skilled in matters related to curriculum implementation. It was further found that good principals initiate, empower, and create good relationships with faculty and other school community members in order to transform their schools. Key words: Mahatma instructional model.
Gandhi,
educational
leadership,
principals,
INTRODUCTION Mahatma Gandhi lived a simple lifestyle and yet was recognized as one of the greatest leaders in the twentieth century. He opened a new dimension of thinking about leadership styles and their impact on institutions, people and other resources. He psychologically, mentally, physically and economically transformed India and Indian people. His leadership inspired Indians to be creative and development conscious that have made them become self-reliant. The purpose of this article is to examine the extent to which school principals in Kenya can transform their schools if they apply Gandhi‘s leadership styles and principles in their schools. The model is intended to increase the understanding of the importance of isolated leadership styles in school functions including school‘s physical development and academic performance. Famous world leaders such as Martin Luther King Jr. and Nelson Mandela, worn impressive praises for their good leadership because they had included some of the Gandhi‘s leadership styles and principles when dealing with their followers. They inspired their followers to uphold on principles of trust, love and care for others. If political leaders who applied Gandhi‘s leadership styles, principles and practices succeeded, then school principals may also be successful in their work when they learn and apply Gandhi‘s leadership styles and principles.
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MAHATMA GANDHI’S LEADERSHIP STYLE Although Gandhi applied his leadership style accord to the prevailing situations, servant leadership was significant among other styles. He literary served his followers with tea (Nair, 1994) causing his followers ask among themselves why he was serving them and yet they were supposed to serve him. To effectively serve the followers, the leader clearly understands the reasons why he or she should serve them and other needs that need the leader‘s support. A leader acts as a researcher who collects data to support the research questions. The leader in the same way collects resources that are likely to meet the diversified needs of the followers. According to Greenleaf (1982), the purpose of a leader serving his or her followers or workers is to be closely visible and to develop good/follower relationships that encourage and inspire them to be committed to their duties in order to achieve the set goals or objectives. When a leader is closer to the followers, he or she learns their strength and weaknesses. Nair (1994) said that when a leader is within the limits of the followers, he or she gets an opportunity to communicate to them his mission for the future and gets a true picture of their feelings. Other than applying servant leadership style to serve people or followers, Gandhi improved the lives of Indians by prioritizing the needs to be attended to though the application of various leadership styles that included transformation, transaction, leader/people oriented, and management by wandering about (MBWA). Gandhi may not have known that he was using leadership styles that would exemplify him as a great leader whose leadership yielded and still produces impressive results when political or leaders of any organization carefully apply them. Since schools are organizations, principals should identify and learn how each of those leadership styles is applied and the expected results.
LEADERSHIP STYLE AND THE ROLE OF TODAY’S PRINCIPALS Principals‘ roles have become complex and demanding. They have become the overall overseers of their schools while pursuing lifelong learning in order to grasp the current leadership theories that would help them change the working climate in their schools. Their lifelong learning would also equip and acquaint them with knowledge and skills that are needed to motivate faculty for effective implementation of curriculum. Depending on the prevailing situations in their schools, they have been seen as agents of change as they apply various leadership styles. Matthews and Crow (2003) noted that principals are expected to focus on teaching and learning, and to facilitate the learning community in their schools, while at the same time pursuing further programs of studies in order to acquire more knowledge and skills. Matthews and Crow categorized principals as partners in collaborative inquiry around teaching and learning as they supervise teachers and staff. Leading and supervising teachers who are knowledgeable and skilled in their areas needs a principal who is able to translate the researched information into teaching objectives. Stolp and Smith (1994) pointed out that a leader, as a designer, should continue learning and trying new strategies that make emerging phenomenon possible. Such a leader in my view, should foster staff development and conduct workshops or seminars in his or her area of specialization. It is during these workshops or seminars that principals communicate or model important values including love, truth, and honesty to their faculty, non-faculty members and students. Mitchell and Cunningham (1990) regarded principals as keys to schools‘ improvement; they are expected to meet the challenges that face their schools. They are expected to make schedules, communicate with parents, inspire personnel, observe classes, monitor and
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supervise the implementation of curriculum, and also articulate the instructional goals. As professionals, principals are expected to be conversant with both the psychology of learning and administrative skills in order to effectively monitor and supervise teachers‘ implementation of curriculum. These aspects relate to Gandhi as a good communicator whose commitment was to empower and improve the conditions and the standards of every Indian. A broad knowledge base about the system and the school community will assist the principal in his or her supervision by-walking- around as Kouzes and Posner (1991) call such supervision as Management by Wandering About (MBWA). This type of supervision enhances visibility and accessibility to employees as well as developing good relationships between workers and management. Although MBWA creates good relationships, it leaves a vacuum for other people assume that the principal wanders around because some teachers do not teach. Nair (1994) explains that Gandhi spent a year travelling around India and Burma where he learned that Indians had lost their self-esteem which may have been caused by lack of direction and communication. People or workers loose self-esteem when they fail to succeed in their plans or fail to fulfill their needs. Gandhi might have been informed of what might have been happening in India and Burma that made people to lose self-esteem. His personal appearance in those areas made people feel there was somebody who was listening and ready to take care of their problems.
PRINCIPALS AS COMMUNICATORS OF VISION Some of the most important aspects of leadership are listening and communication. Effective principals listen and communicate their views and workable visions to their faculty members, non-teaching staff, students, and outside world. Nair (1994) applauded Gandhi‘s leadership style as one that sought to understand the needs of the people he served. Nair (1994) advised leaders to get personally involved by speaking and listening to the people, and also by observing and sharing their experiences. Gandhi‘s leadership emanated from the people themselves. He had first to understand the psychology of his people. His interactions with the Indian people became a milestone in the change of his own lifestyle in order to be closer to them. He changed from Western to Indian dress and then to a loin cloth (Nair, 1994). Indians had their way of dressing even before Gandhi became their leader. They had their own attire although western way of dressing had permeated in some Indian tribes. Gandhi, who had negative attitude toward importation of western cloths to India, organized the boycott of those cloths manufactured in Europe. He advised his people to join him in spinning Indian loins. Although Gandhi‘s inspiration to develop and improve Indian cloth factory was seen as a move toward industrialization, it may not be used by school principals to change the images of schools. Effective principals have open-door leadership that welcomes anyone with complaints or ideas that would help them change their schools‘ images and performance. Most school communities and parents are concerned with their children‘s performance on standardized tests and want their schools to be effectively managed. These needs can be met when the principal and his or her faculty members have an established vision. A vision is the deepest expression of what an organization wants to achieve. It is a declaration of a desired future, which creates the conditions for having an aligned team and is also seen as an expression of hope for a bright future. An effective principal encourages and supports his or her faculty to participate in the development of their school, academically, physically, and morally. When teachers feel they are part of the school, they become committed to curriculum implementation that brings about the required academic standards. Principals create good relationships with
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teachers on the core business of teaching, and the more they communicate goals and expectations about quality teaching and learning for each student, the more effective they are likely to lead their schools towards improved students‘ performance (Hughes, 1994; Kiwi Leadership for Principals, 2008). Gandhi developed a vision that led to the attainment of India‘s independence in 1947. His vision was ―a free, united India.‖ A free, united India could not be attained without people risking their lives. He prepared his people to be ready for whatever consequences would be inflicted on them by the British government which was the colonial power in India at that time. He inspired them to be courageous and to refuse to submit to unjust laws, to refuse to retreat, and not to retaliate when subjected to violence by law-enforcement personnel (Nair, 1994). Every school in Kenya, developed a vision, mission, and motto, and installed them at the gate for every person to read the future expectations of the school. If the creation of these symbols of great expectations came as a result of the Kenyan Ministry of Education‘s policy, the outcome has not been significantly realized. The physical appearance and academic performance remained as they were before the establishment of vision, mission, and motto. Nobody has followed to investigate why some schools have not been improved according to what their visions and missions stipulate. The cause may be the principals‘ leadership styles that are not focused on improvement.
Hughes (1994) stated that creating a vision of greatness helps an organization define what it has to offer that would make a difference. A vision helps to build an organization that expresses values, beliefs, commitment, and creates good relationships between the leader and employees. A vision or an image directs the principal and school community where the school is heading and the kind of school that the community desires to have in the future. The principal who is a practitioner in the twenty-first century, supports the faculty and the school community in achieving the stated goals. Stolp and Smith (1994) observed that the role of a principal is to facilitate reforms, at the same time reflecting on how those changes affect staff and students. The developed vision in any organization is maintained when there is a philosophy that focuses on the future. Each school in Kenya developed a philosophy which may lead it to higher achievement. The question is: Who develops a school‘s philosophy? The development of a philosophy should be collaborative venture where the principal, faculty members, some community members, and even some students meet and develop an acceptable philosophy. Gandhi‘s philosophy of charkha simplified Indian life and focused on traditional activities rather than western development (Nair, 1994). Gandhi‘s commitment was to improve the lives of Indians and to instill courage, while at the same time, discouraging them from retaliating to British violence. At times, principals develop contradicting philosophies, visions, and missions that cause friction in their schools. Such contradictions occur when a principal assumes the responsibility of developing guiding factors, including school rules. The purpose of developing a philosophy, vision, and mission in my view is to cause change, and also to direct the achievement of that change. Stolp and Smith (1995) observed that a principal alone may not cause change in his or her school, because cultural transformation is a collaborative activity. As a transformational leader (Burns, 1987; Tichy and De Vanna, 1990), the principal must engage others, both inside and outside the school, if he or she is to effect any meaningful changes in school culture that would encourage faculty and staff to be committed to producing good results. Goldring and Rallis (1993) postulated that leaders who often take risks are goal oriented and are likely to stress accomplishment mastery and high achievement.
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PRINCIPALS AS COLLABORATORS Attaining recognition of high achievement comes with teamwork. Hughes (1994) stated that a key leadership function is helping faculty, staff, students, and community realize that the school belongs to them, and that it is their school, and what happens in that school is their responsibility. A good principal listens and accommodates faculty and nonteaching staff constructive ideas which may be used to solve a problem, improve the existing school facilities or raise school‘s academic standards. Some principals at times, use power-based approach to reinforce their decisions to their employees. School administrators should learn from Gandhi‘s leadership that effective principals use their authority and power to persuade and influence their students, faculty members and other stakeholders to realize that they are all accountable for the achievement of the stated school objectives or the goals they developed. Every participant in an organization or institution of learning has the potential of performing well if there is encouragement from the leader. Hughes (1994) observed that a principal who is task or achievement-oriented sets goals that are challenging yet attainable, and encourages goal attainment by expressing confidence in subordinates‘ abilities to reach those goals individually or collaboratively. Fischer (1983) indicated that Gandhi became a revolutionist and a collaborationist as he returned to India in 1915. He craved for his country a cultural regeneration and spiritual renaissance that could rejuvenate Indian people to become revolutionary in order to drive the British regime out of India. Twenty first-century principals should be seen as revolutionists as they transform various images of their schools including academic performance, physical facilities, changing attitudes from negative to positive toward teaching, learning, and serving processes.
PRINCIPALS AS ROLE MODELS Gandhi exhibited lifelong learning. He read many books concerning philosophy, law, religion, and social psychology. He combined reading and visiting Indian villages in order to observe the conditions under which his people were living. According to Nair (1994), Gandhi developed an educational program that would be used in maintaining good sanitation and public health. He assisted the villagers to be innovative by developing village industries that dealt with the spinning of cloth. To demonstrate what he wanted his people to do, he concentrated on spinning and weaving, at the same time encouraging the rest of India to support the cause of the villagers by wearing only hand woven handspun cloth. To show solidarity with villagers, he spun daily and wore only hand woven handspun cloth. His role model of commitment permeated deeply into Indian society and shaped their values and beliefs. They were being prepared to become self-reliant after independence. Marsh‘s findings as edited by Fullan (2000) said that the role of the school principal is to develop a strong culture at the school that includes a safe and orderly work environment, and that they should involve their students in order to improve teaching and learning. Marsh (as cited in Fullan, 2000) explained that principals should develop a strong staff collaboration and cohesive relationship among their staff members and student body. When cohesive relationship exists and exhibited by employees in an organization in my view, creates a feeling of oneness, harmony, and ownership. These aspects create good working environment that encourages the attainment of the organizational goals.
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Gandhi was a mediator who worked for unity in his people. Spear (1989) stated that Gandhi was a hyphen connecting the middle classes and the upper class people. The foundation of his influence was based on truth. Truth and openness are important factors in leadership. School principals should be open minded and speak the truth to their school communities in order to avoid conflicts. According to (Roe & Drake, 1980) principals should have the ability to serve as coordinators, mediators, and arbitrators in their schools. Gandhi rarely discriminated against people because of their ethnic groups, socioeconomic or political status. He used humanity as a weapon to unite people of all classes. A school principal should be seen as a symbol of unity in his or her school in order to develop the school and improve the school academic performance. He or she is seen as an engineer and the pilot of the school. Working as a pilot and as an engineer, the principal should initiate, organize the development and performance processes in the school. The principal is the manager, an administrator and the supervisor of all the school functions despite delegation of duties to faculty and non-teaching staff. He or she should ensure that physical facilities and other resources are available and appropriate for effective teaching and learning that are based on commitment and love for work. Gandhiâ&#x20AC;&#x2DC;s satyagraph policy of non-violence was based on love, truth, trust, commitment, and loyalty. This was maintained during the struggle for independence because of his good leadership that instilled and encouraged patience and persistence in Indian people. Bennis (1989) indicated that leaders are persistent and that failure is viewed as an opportunity to learn. Not all leaders accept failure as an opportunity to learn and change from negative to positive. However, many leaders, including some principals, realize their mistakes and recover from them. Gandhi had that quality of persistence. He continued wearing handspun clothes in order to demonstrate that handspun cloths were as good as imported cloths. He boycotted foreign cloths and influenced his people to follow his style of wearing. He was a role model that changed the Indian cultural attire up to this century. Principals can change the dress culture of schools or communities if they exhibit neatness in their dress. Lane and Walberg (1987) stated that neatness is an aspect which schools are to maintain, and that teachers are pressured to conform to a defined norm of personal appearance and institutional image. Mitchell and Cunningham (1990) explained that if schools operate under the norms of a strong professional culture, with teachers and principals operating in an interdependent but connected relationship, a re-conceptualized leadership is to be applied in schools. Principals lead by working cooperatively with teachers and other stakeholders to build a safe and innovative culture. Communities regard school principals as engineers that keep the schoolsâ&#x20AC;&#x2DC; machinery working through symbolic facilitation and political strategies. Cunningham and Gresso (1993) wrote that culture building requires that school leaders give attention to the informal, subtle, and symbolic aspects of school life which shape the beliefs and actions of each employee within the system. The task of leadership, according to Cunningham and Gresso, is to create and support a culture that fosters an attitude of effectiveness in everything that is done within the school. Creating and maintaining such a culture involves every member of the school community. Kiwi Leadership for Principals (2008) said that principals, who focus the school culture on enhancing learning and teaching, create a culture in which teamwork is expected and valued, and in which teachers are empowered to take on appropriate leadership roles. Principals initiate teamwork especially curriculum implemention of complex topics that need different specialties in order to achieve the stated objectives.
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DISCUSSION Successful leaders are students of other leaders or the people they lead. Gandhi displayed different styles of leadership and executed personal principles that school principals should learn and apply in schools. One major aspect that Gandhi excelled in social life was the changing of morals and instilling spiritual beliefs in people. He changed people‘s habitual behaviors and energized the feeling of self-esteem and self-reliance. This is the first lesson that principals should learn from Gandhi‘s leadership that it is not only changing the outlook of their institutions, but also changing the behaviors that focus on maintaining good discipline in teachers, students, and non-teaching staff. Discipline and academic performance relate to each other. Schools that achieve high performance in Kenya National Examination ensure that high standard of discipline is maintained. The second lesson that school principals should learn from Gandhi is respect. Discipline in a school is realized and felt when everyone including principal and parents show and exercise maximum respect to each other. Poor discipline in schools is strengthened when stakeholders do not play their roles of modeling including guiding and counseling. The third lesson which principals should learn from Gandhi is trust. Trust is an important component of good relationship that flourishes when individuals respect and trust each other. In a school where these two principles are practiced, there is a pleasant working environment that act as a motivator which attracts experts in different areas to want to join the institution. Principals who are development conscious seek and retain teachers, students, and non-teaching staff who demonstrate high respect before others. The forth lesson that principals should learn from Gandhi is truth. Corporation and collaboration in any organization exist when telling the truth becomes everyone‘s obligation. Schools that observe truth and respect as a policy may not have conflict problems. When members of an organization trust each other and tell the truth all times, they create harmony and conducive working environment. The fifth lesson that principals should learn from Gandhi is serving rather than being served. When principals look for relevant teaching materials and avail them to teachers and students, they are serving them. When a principal serves teachers, students, non-teaching staff and parents, he or she encourages the feeling of ownership and empowered to perform their respective duties with care. The sixth lesson that principals should learn from Gandhi is creating unity in their schools. School principals are pillars of unity and oneness in their schools. In a school where teachers work as a team, there is commitment that focuses on observable development and higher academic achievement. Working as a united team provides no room for gossiping, and laziness but encourages trust and commitment to achieve the institutional objectives and goals. The seventh lesson that school principals should learn from Mahatma Gandhi is persistence. Discipline is one area that needs school administrators‘ persistence in stressing on parade or whenever they address students on matters that concern learning. They should learn to manage conflicts as Gandhi managed the conflict between touchable and untouchable. The eighth lesson that school principals should learn from Gandhi is innovation of special skills which they may demonstrate to others during seminars or workshops. Gandhi demonstrated to his people how to make cloths by spinning. The ninth lesson that principals should learn from Gandhi is becoming lifelong learners. Gandhi used to read books even those that were not within his specialty not only for leisure, but for the purposes of acquiring new knowledge and wisdom. Fewer principals than teachers in Kenya are returning to college after their first degrees. They should continue learning in order to be conversant with the emerging information technology.
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The tenth lesson that principals should learn from Gandhi is listening. Since principals are leaders who serve people from different economic and social status, they should develop good listening skills that help them incorporate the meaning of messages from teachers, students, non-teaching staff, and parents. The eleventh lesson that principals should learn from Gandhi is communication skills. Principals should have good communication skills that influence and persuade those around them to respond to situations positively. Through effective communication, principals modify the attitudes and behaviors of their school communities. The twelfth and last lesson that principals should learn from Gandhi is how he utilized the general administrative elements that include planning, organizing, coordinating, controlling among others. Successful principals plan, schedule themselves and make comprehensive reports for the head offices. They organize and coordinate curriculum implementation and other functions that are intended to improve their institutions. However, not all practices that Gandhi exhibited are worthy learning and applying in Kenyan schools. Principals are seen to be organizers, coordinators, initiators, and controllers of resources both human, physical facilities, and materials. If a toilet (as is known in Kenya) looks filthy, the principal consults master on duty or sanitary master to organize students to clean, but not the principal to be seen cleaning the bathroom (as it is known in the United States). Consequently, the principal, sanitary master, or deputy principal has to remind the students on why it is important to keep toilets clean. Demonstration makes learning life and interesting. Gandhi used demonstration method to illustrate how to spin cloths while strengthening the attitude of wearing loins. This practice is suitable for teaching instructions not for administrative purposes. Some of the political practices such as travelling to different areas talking to people may not be practiced in schools. Since principals are concerned with overseeing the implementation of curriculum in their schools, they have limited time to travel to various places as political leaders.
CONCLUSION This article spells out some of the lessons that school principals should learn from Mahatma Gandhi‘s leadership styles, principles, and practices that included transformational, transactional, task-people oriented, and servant leadership. Gandhi persisted in applying his principles that changed his people‘s behavior and practices. He changed people‘s morals and instilled spiritual beliefs that transformed their social behaviors and lifestyles. Some successful world leaders such as Martin Luther King Jr. and Nelson Mandela applied Mahatma Gandhi‘s leadership and principles. Principals too may be successful in their leadership if they emulate and practice Gandhi‘s leadership styles and principles that guided and transformed Indian people. Twenty first century principals should be lifelong learners in order to acquire relevant technological skills which may be used in changing the image and academic performance of their schools.
THE PURPOSE OF THIS MODEL This combination of instructional procedures focus on the content related to typical leadership courses offered to Master‘s and Doctoral programs. Practicing school principals and those aspiring to be principals who take this model will begin to realize that leadership styles vary according to situations and circumstances. This model may help them to: Realize their own values that may be similar to those of Gandhi.
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Identify leadership styles that may be appropriate for their schools, depending on situations and circumstances. Assist their faculty members to become more effective teachers. Develop good team attitude and cooperation. Promote good communication skills among school community members To develop their personal principles, and Enable others to achieve upward mobility.
LEARNING ACTIVITIES The leadership approaches described in this model are intended to improve the skills and widen participants‘ knowledge on leadership practices. Students should be asked to compare and contrast leadership styles that are currently used in educational organizations. In order to understand various leadership styles, students are required to read books on leadership, Journal articles, magazines, and also visit different schools and industries to observe how principals and managers execute their leadership and managerial skills and also how they use their knowledge and manipulative skills to solve some problems. Students should be asked to observe principals‘ behavior and how they interact with their juniors. Each student or a group of students should write and compile their observations and present them to other members of their classes.
READING ASSESSMENT After reading this article, students should answer the following questions: 1 a). Define and differentiate between transformational, charismatic, servant and transactional styles of leadership. b). Explain, giving sufficient reasons, why a high school principal might prefer to use one of these styles and not the other? 2. In which ways does a people-oriented leadership style differ from task-oriented style? 3. For the last five years, your school has been on the top rank on academic performance. List and explain each leadership style you, as a principal has been using in order to realize such performance. 4. Giving relevant examples, discuss: (a) The potential success of Gandhi‘s leadership styles in schools. (b) The potential failure of Gandhi‘s leadership styles in schools, and (c) Suggest how Gandhi would have done it better. (d) Assuming that you are a high school principal whose school is academically performing poorly in the standardized or national examinations compared to the surrounding schools, discuss giving relevant examples how Gandhi‘s leadership style will help you to raise the academic standards in your school.
OUTSIDE CLASSROOM ASSIGNMENT Parents and community members of school ―A‖ have praised the principal of the school for higher performance on standardized examinations and expressed their disappointment with the performance of the principal of school ―B‖ for the poor performance on the same examination.
a). Develop questionnaires and conduct a research study to establish the leadership and other related causes of good performance in school ―A‖ and poor performance in school ―B.‖ The researcher will be required to get the number of candidates in each school and to use statistical methods (e.g. independent t test) to compare the performance of the two
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schools using mean scores in the last three years. All statistical analysis should be conducted using the Statistical Program for the Social Sciences (SPSS). b) Present your research findings to the whole class. c) Suggest what the principal in school ―B‖ should have done to raise the school‘s performance index. d) What would you do differently to change school B‘s poor performance to better performance? e) Assuming you are Mahatma Gandhi, what advice would you give the two principals?
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Burns, J. M. (1978). Leadership. New York, NY: Harper & Row. Bennis, W. (1989). Why leaders can’t lead: The unconscious conspiracy continues. San Francisco, CA: Jossey-Bass. Cousins, N. (1969).Profiles of Gandhi: America remembers a world leader. Delhi, Indian: Book Company. Cunningham, W. G., & Gresso, D. W. (1993). Cultural leadership: The culture of excellence in education. Boston, MA: Allyn and Bacon. DeGraaf, D.G., Jordan, D. J., & DeGraaf, K.H. (1999). Programming for parks, recreation, and leisure services. State College, PA: Venture. Fischer, L. (1983). The life of Mahatma Gandhi. New York, NY: Harper & Row. Fullan, M. (Ed.), (2000). Educational leadership. San Francisco, CA: Jossey- Bass. Gardner, J. W. (1990). On leadership. New York, NY: Free Press. Goldring, E. B. & Rallis, S. F. (1993).Principal of dynamic schools: Taking charge of change. Newbury Park, CA: Sage Greenleaf, R. K. (1982). Servant as leader. Indianapolis, IN: Robert K. Greenleaf Center. Hay, L., & Henri, J. (August, 1995). Leadership for collaboration: Making vision work. Retrieved from http://www.ifla.org/IV/ifla61/61-hay1.htm Hersey, P. & Blanchard, K. H. (1982). Management of organizational behavior: Utilizing human resources. Englewood Cliffs, NJ: Prentice-Hall. Hughes, L. W. (Ed.). (1994). The principal as leader. New York,NY: Merill. Joseph, P. (May, 2012). Mahatma Gandhi‘s concept of Educational Leadership. International Journal of Economics Business and Management Studies. ISSN: 2226-4809. Vol. 1, No. 2. (p. 60-64). Kiwi Leadership for Principals (2008). Principals as educational leaders. New Zealand, Ministry of Education, ISBN 978-0-478-13894-8 (web). Kouzes, J. M. & Posner, B. Z. (1991). The leadership challenge: How to get extraordinary things done in organizations. San Francisco. Jossey-Bass Publishers. Lane, J. J., & Walberg, H.J. (Ed.). (1987). Effective school leadership: Policy and process. Berkeley, CA: McCutchan. Lindholm, C. (1990). Charisma. Berkeley, CA: Basil Blackwell. Matthews, L. J., & Crow, G. M. (2003). Being and becoming a principal: Role conceptions for contemporary principals and assistant principals. Boston, MA: Allyn & Bacon. Mbatia, M. (March, 2005). Burden of Indiscipline. School and Career. The Standard Group. Nairobi. Mitchell, B., & Cunningham, L. L. (1990).Educational leadership and changing contexts of families, communities, and schools. Chicago, IL: The University of Chicago Press. Moon, P. (1969). Gandhi and modern India. New York, NY: W.W. Norton. Murphy, J. (2002). The educational leadership challenge: Redefining leadership for the 21 century. Chicago, IL: The University of Chicago Press.
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Nair, K. (1994). A higher standard of leadership. Lessons from the life of Gandhi. San Francisco, CA: Barrett-Koehler. Northpuse, P. G. (2001). Leadership theory and practice. Thousand Oaks, CA: Sage Richards, G. (2001). Gandhi’s philosophy of education. Oxford, England: Oxford University Press. Schine, J. (Ed.). (1997). Service learning. The University of Chicago Press. Sergiovanni, T. J.; Burlingame, M.; Coombs, F. S. & Turston, P. W. (1992). Educational governance and administration. Boston, MA: Allyn and Bacon. Sinha, S.G. (n. d.). Mahatma Gandhi, A role model of service. Retrieved from http://www.ssinha.com/service.htm Siringi, S. (2000 August 7). Rising student unrest blamed on poor managers. Daily Nation, Nairobi. Retrieved from http://www.corpun.com/kes00008.htm Spear, P. (1989). India: A Modern History. Delhi, India: Surjeet. Tichy, N. M. & De Vanna, M. A.(2nd ed.). (1990). The transformational leader. New York, NY: John Wiley. Wheatley, M. J. (1999). Leader to leader. Winter. No.11. Retrieved from http://www.pfdf.org/leaderbooks/L2L/winter99/wheatley.htm1
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Economic Globalization, Income Inequality and Economic Growth in Nigeria: A Static Data Analysis (1986-2010) Ogunyomi, Oluwatosin .O.1; Daisi, Olusegun Richard2; & Oluwashikemi, RasaqAdebola3 1&3
External System, Lagos State University, Nigeria Department of General Studies, Lagos State Polytechnic, Nigeria
2
ABSTRACT This study examines the impact of economic globalization on income inequality and economic growth in Nigeria from 1986 to 2010. The study methodology was mainly Static Linear Econometric Model. Two models were used to test the two dependent variables simultaneously. The findings revealed that economic globalization had caused a widening income inequality as well as reduced economic growth of Nigerian economy due to much emphasis on financial globalization and other macroeconomic imbalances rather than trade globalization. It is therefore recommended that for Nigeria economy to exploit the gains of economic globalization just like the Asian Tigers, the Government should demonstrate good governance at all tiers of government through protectionist domestic policy, fiscal efficiency, political stability, adequate infrastructural provisions and encourages entrepreneurship development in Non-oil sectors to drastically reduce income equality between the unskilled and skilled labours.
Keywords: EconomicGlobalization, Financial Globalization, Trade Globalization, Economic Growth and IncomeInequality.
1. INTRODUCTION Globalization is defined as a comprehensive process of economic integration which enhances international mobility of national resources and increases interdependency of national economics (OCED 2005, P. 11). Therefore, globalization is a multidimensional phenomenon, which covers all aspect of social, economic, political and cultural sphere. However, the most concerns for economists are economic globalization and its consequences on national economies within and between countries of the world.According to Bhagwati (2004, P. 3) defined economic globalization as integration of national economies into the international economy through trade, Foreign Direct Investment (corporations and multinationals); Short term capital flows; international flows of workers and flows of technology. Historically, the advent of economic globalization to many countries of the world was a result of the debt crisis suffered by many countries in 1980s. This was in the form of high inflation rate and worsening balance of payment positions. The aftermath of this crisis led the International Monetary Fund (IMF) and World Bank (WB), under the guise of
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â&#x20AC;&#x2022;Washington Consensusâ&#x20AC;&#x2013; to facilitate a guided economic restructuring in the number of countries. Therefore, the Less Developed Countries (LDC) were asked to open up their economics and integrate with the world economic through adopting Structural Adjustment Programs (SAP); Post â&#x20AC;&#x201C; SAP through economic liberalization and now emerged globalization in the Less Developed Countries. Theoretically, the proponents of economic globalization argued that integration into the global economy promotes economic growth, which in turn helps to solve problems of poverty, inequality, lack of democracy and pollution and a considerable reduction in poverty. Therefore, these aforementioned benefits aroused the aspiration and expectation of Nigeria to embrace the economic policy of Globalization, through Structural Adjustment Programme in 1986 under the administration of Ibrahim Babangida. In recent time, Globalization had been widely perceived by both Pro-globalist and antiglobalist as a dual sided phenomenon, which had been beneficial to many developed countries but has not helped matters in most developing countries like Nigeria. Therefore, a quantum of research had proven theoretically and empirically that globalization had a mixed outcome. The anti-globalist argued that globalization adversely affects the poor and particularly poor countries creating an increase income inequalities within and between the countries of the world while the pro-globalists claimed that it has led to higher growth employment generation and poverty reduction (Roud and Whalley, 2002; Abid and Anila, 2005, Atif et al, 2012 and Bussmann, SoysaandOneal, 2005) in Asia Tigers like China, Japan, Korea provides an example of a positive effect of globalization on growth. The spectacular growth of the countries of East Asia raised per capital / income by eightfold and raised hundreds of millions out of poverty. However, in some regions Americans Countries, SAP has led to depressing economic prospects. Similarly, most African countries that had embraced economic globalization had resulted to structural economic divergence; i.ewidening income inequality, collapse of Infant Industries because of the dependency International theory and less of economic convergence, informed by technology transfer, increased market size and relative employment generation. Therefore, the mixed effects and unambiguous literature debates of the impact of economic globalization on income inequality and dismal record on economic development has brought to fore as well as the threats to national economic development within developing countries and between developing and developed countries on the other hand Greenway et al (2002); Kemal et al (2002), Almas (2003). Furthermore, they claimed that globalization affect growth in different countries in different way due to difference in government policies, population growth rate and the different institutional factors across countries. Based on the inconclusive evidence among scholars and policymakers on the various degree of the costs and benefits of economic globalization. This paper therefore tends to empirically examine the effect of economic globalization on income inequality and economic growth in Nigeria between 1986 and 2012. Other objectives includeascertaining the causes of income Inequality in Nigeria and recommendations for making the positive gains of globalization totranslate to economic development of Nigeria.The rest of the paper is divided into four sections: Section II deals with the review of Literature and Theoretical Framework. Section III discusses methodology and sources of data. Section IV presents results and discussion while section V contains the conclusion and recommendations.
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2. LITERATURE REVIEW 2.1 Review of Theoretical Literature Economic globalization on the other hand refers to the integration of the domestic economies with the world economy and the inevitable consequential increase in the economic interdependence of the countries through trade, financial and investment flows, free factor movements and exchange of technology and information. Thus, openness and markets constitute the platform of globalization while trade, finance and investment and entrepreneur are the heart (Obadan, 2003). The concept of inequality and income inequality on the other hand connote the absence of sameness, evenness or equality while the latter in development economics theory examines the extent of income distribution in a particular place or country or system. According to Todaro and Smith (2003), income distribution could be measured from the standpoint of the personal or size distribution of income and the functional or distributive factor share distribution of income.The personal or size distribution of income measures the total incomes received by individual persons or households. That is, the level of income received by the richest quintile, decile or percentile of a population compared with the level of incomes received by the poorest quintile, decile or percentile of the population respectively.While the functional or factor distribution of income measures the share of total national output or income that each factor of production received (Todaro and Smith, 2003).In summary, out of the two explored methods of measures income inequality, economist often uses the personal income distribution. Theoretically, there are various methods of measuring income inequality, namely the quintile, decile and percentiles approaches; another methods employed is the Kuznets ratio, which uses the ratio of the total income of the richest 20 percent to the total income with respect to the poorest 40 percent of the population. Another recent method of measuring personal distribution of Income is the Lorenz curve, which shows the cumulative frequency distribution of a given valuable, i.e income compared with the uniform distribution that represents equality. The most widely used single measure of income inequality is apparently the Gini coefficient. It can be obtained by calculating the ratio of the area between the diagonal and the Lorenz curve to the total area of the semi â&#x20AC;&#x201C; square in which the curve lies. Jhingan (2002) defines economic growth â&#x20AC;&#x2022;as the process whereby the real per capita income for a country increases over a long period of time. â&#x20AC;&#x2022; it is often measured by a percentage change in gross (or real) per capita national product (GNP). Several factors have been identified as causes of economic growth. These includes advancement in technology, international trade or degree of openness of the economy or trade liberalization, human capital and education, foreign capital inflow and investment, sound macroeconomic (fiscal, monetary, exchange rate and incomes) policies and institutions; good governance, physical capital formation etc. From the above, it is clear that globalization, income equality and economic growth are related theoretically. Globalization is often associated with less restrictive trade regimes resulting in more openness of the economy with concomitant increase in volume of trade, which generates higher income among the people. Therefore, the theory of openness argued that the higher the level of openness, the better economic performance of the host country, which affects economic growth within and between the countries of the globe. Economists have more thoroughly considered the effect of trade on the distribution of incomes within countries. According to neo-classical theory, free trade should decrease inequality in developing countries because they have a comparative advantage in unskilled
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labour. Trade increases the income of the factors of production used intensively by exporters. Cooper (2001) concludes recent empirical results are consistent with the view. Borsu and Glejser (1992) and Reuvemy and Li (2003) reported that the trade to GDP ratio is associated with more equitable income distribution in both the core and the periphery. International trade theory implies that increased trade and foreign investment should make income distribution more equal in poor countries and less equal in rich countries. However, the prominent theory of income inequality was advanced by Kuznets (1955) when he relates income inequality within countries to their average income. Kuznet noted that the beginning of income inequality is traceable to the era of industrial Revolution, whereby people moved from the agricultural occupation characterized with uniform low incomes into cities, and earned higher wages in industry. He concluded that economic development might similarly affect the distribution of income, and a number of studies support Kuznets‘ theory (Weede and Tie fenbach, 1981; Muller 1988; Higgins and Williamson 1999; Barror 2000; Bhalla 2002; Reuvemy and Li 2003); but others have been contradictory in the time series analyses (Chan 1989; Anand and Kanbur 1993). According to Lindert and Williamson (2001); O‘Rourke (2001), and Aghion and Williamson (1998) in their study of the link between globalization and inequality state that increased world income inequality has been driven by between country rather than within – country inequality. Theory suggests that globalization will have very different implications for within – country income inequality, depending on the dimension of globalization involved, on the country concerned, and on the distribution of endowments. The world economy has become more globally integrated that can be interpreted as globalization has raised inequality between nations. The direction of impacts on the within country inequality depends on participating country‘s changes in their policy to exploit it. The source of income inequality in a globalized world with vast regions with inferior education and chaotic institutions could be poor government and non-democracy but not globalization. In summary, the theoretical research on the link between globalization growth and income inequality was discussed from the standpoint of three growth theory. The neo-classical growth theory predicts convergence (increasing equality) because of increase mobility of capital through international trade. However, the endogenous growth theory predicts less convergence or divergence (increasing income inequality) because of increasing return to technological innovation in developed countries and absence of fundamental macroeconomic structure to exploit the gains of globalization in less developed countries. Finally, the dependency growth theory predicts that divergence (increasing income inequality) is more likely because of differentials in benefits from the economic integration and trade and locked production structure in Less Developed Countries (LDCS). Therefore, it was established theoretically that Globalization has increased income inequality between country while the within – country income inequality or distribution cannot be fully linked to globalization, but rather due to by the countries inferior education, chaotic institutions, poor governments and non – democratic domestic redistributive politics. 2.2 Review of Empirical Literature Globalization and its linkage with economic growth and income inequality between countries and within countries over the past decade had degenerated to a lot of controversies among scholars and policymakers. Various studies had proven that globalization increases growth as well as widening income inequality between countries and even within – countries of the world, whereas other numerous studies found that globalization had reduce income inequality within – countries as well as equal growth
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between countries. In this study for value judgement between the pro-globalist literature and anti-globalist literature, the research extensively analyses the various literature conclusion, in order to draw an inference on the controversy issue. Neutel and Heshmati (2006) examined relationships between globalization, inequality and poverty. Their results from cross-national regression analysis show that there is a significant relationship between globalization and income inequality. Agenor (2002) examined the extent to which globalization affects the poor in low-and middle income countries. He began with a description of various channels through which trade openness and financial integration may have an adverse effect on poverty. Agenor presented crosscountry regressions that relate measures of real and financial integration to inequality. He used not only individual indicators of trade and financial openness but also a ―globalization index‖ based on principal components analysis, and tested for both linear and nonlinear effects. His results suggested that there is inverted U-shape relationship between globalization and inequality. At low levels, globalization appears to hurt the poor; but beyond a certain threshold, it seems to reduce poverty-possibly because it brings with it renewed impetus for reform. Figini and Gorg (1999) analyzed the effects or multinational companies wage inequality in the host country. Their empirical results for the Irish manufacturing sector between 1979 and 1995 suggested that there is an inverted U shape in wage inequality. They found that the presence of MNCs, which increases the demand for skilled labour, leading to rising wage inequality between skilled and unskilled workers. Over time, indigenous firms learns the new technology by imitating MNCs, and previously unskilled workers become skilled through working with the new technology. This, subsequently, leads to a decrease in wage inequality. Feenstra and Hanson (1997) examined the increase in the relative wages of skilled workers in Mexico during the 1980s. they argued that rising wage inequality in Mexico is linked to capital inflows from abroad. The effect of these capital inflows, which correspond to an increase in outsourcing by multinationals from the United States and other northern countries, is to shift production in Mexico towards relatively skill-intensive goods thereby increasing the relative demand for skilled labor. They found that growth in Foreign Direct Investment (FDI), as a progress in globalization is positively correlated with the relative demand for skilled labor. In the regions where FDI has been most concentrated, growth in FDI can account for over 50 percent of the increase in the skilled labour share of total wages that occurred during the late 1980s and 1990s, reducing the inequality rate. Milanovic (2003) presented another attempts to discern the effects of globalization by using data from household budget surveys and looking at the impact of openness and foreign direct investment on relative income shares of low and high deciles. He found some evidence that at very low average income levels, it is the rich who benefit from openness. As income level rises to those of countries such as Chile, Colombia, or Czech Republic, for example, the situation changes, and it is the relative income of the poor and the middle class that rises compared with the rich. It seems that openness makes income distribution worse before making it better, or differently in that the effect of openness on a country‘s income distribution depends on the country‘s initial income level. Furthermore, Adams (2007) examined the impact of globalization on income inequality for a cross section of sixty two developing countries over a period of seventeen years. The results of the study indicate that globalization explains only 15 percent of the variance in income inequality. This findings suggest that globalization has both costs and benefits and that the opportunity for economic gains can be realized within an environment that supports and promotes sound and credible government institutions, education and technological development.
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Wan et al. (2007) discussed China‘s globalization process and estimated an income generating function, incorporating trade and FDI variables. They found that globalization constitutes a positive and substantial share of regional inequality and the share rises over time. Also economic reform inequality, and finally the relative contributions of education, location, urbanization and dependency ratio to regional inequality have been declining. Cornia (2003) reviewed changes in global, between – country and within – country inequality over 1980 – 2000 against the background of the shifts that occurred in this area during the globalization of 1870 – 1914. He found that recent changes in global and between – country inequality are not marked and depend in part on the conventions adopted for their measurement. In contrast, within – country inequality appears to have risen clearly in two thirds of the seventy three countries analyzed mainly because of the policy drive towards domestic deregulation and external liberalization. Meschi and Vivarelli (2009) used a dynamic specification to estimate the impact of trade on within – country income inequality in a sample of sixty five developing countries (DCs) over the 1980 – 1999 periods. Their results suggested that trade with high income countries worsen income distribution. Sato and Fukushige (2009) analyzed the determinants of theGini coefficient for income and expenditure in South Korea between 1975 and 1995. In both cases, they did not find support for the Kuznets inverted-U hypothesis. From an economic globalization viewpoint, the opening of goods markets reduces income inequality in both short run and long run. On the other hand, the opening of capital markets may increases income inequality in both period. Borjas and Ramey (1994) use cointegration techniques to investigate causal effects between various explanatory variables and income inequality for the United States. It is concluded that the only explanatory variable that follows a significant long term trend to income inequality is the durable goods trade deficit as a percentage of GDP. Using trade as a proxy to globalization, the study suggests a positive relationship between inequality and globalization. A particular strength of this paper is the rigor of the econometric time series analysis. Robust statistical inferences tests are presented that demonstrate the validity of the models employed. However, the primary limitation of this analysis is that the source data relates only to the USA. It is therefore not appropriate to apply conclusions obtained from this analysis to other economies, particularly those of developing nations. Edwards (1997) investigates the relationship between trade policy and income distribution by regressing Ginicoefficient over six different indicators of trade openness. The paper concludes that there is no evidence to suggest that trade liberalization, or increased globalization, has any significant impact on income inequality (Edwards 1997, p209).The discussion regarding measurement issues of the trade indicators is a relative strength of this paper. But using more than one measures of trade liberalization, the analysis shows that some indicators of increased trade improve income distribution, others have the opposite effect. Therefore, the analysis concludes absence of any clear link between increased trade and income inequality. A limitation of the analysis, however, is that the final Ordinary Least Squares regression model is not statistically significant with R2 = 0.28 (Edwards 1997, p. 209). Marjit, Beladi and Chakrabarti (2004) provide a theoretical analysis of the possible impact of trade on income inequality. In particular, the analysis focuses on the gap between skilled and unskilled labour in a small developing economy. The analysis suggests a strong decline in the relative income of unskilled labour following an improvement in the terms of trade.This paper particularly highlights that an overwhelming majority of the research on the impact of globalization on income inequality has been carried out on data
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from the North which can be regarded as a definite strength of this paper. However, as the discussion is predominantly theoretical, a limitation of this paper is the lack of econometric modeling to support the conclusions presented. Bergh and Nilsson (2011) examine the link between globalization and within country income inequality, after adding several control variables and controlling for potential endogeneity using GMM. They included that reforms towards economic freedom seem to increase inequality mainly in the North; whereas social globalization is more important in the South. It is also found that monetary, legal and political globalizations do not tend to increase inequality.This paper has the distinct advantage of making a distinction between different forms of globalization. In addition, this paper presents robust econometric analysis with a large sample of panel data (80 countries, 1970 â&#x20AC;&#x201C; 2005). In particular, the KOF index is used as a measure of Globalization, and the Economic Freedom Index of the Fraser Institute is used to measure within country income inequality. Zhou et al. (2011) investigate the impact of globalization on income inequality distribution in 60 developed, transitional and developing countries in 2000. It wasrevealedthat globalization can either alleviate or worsen the income inequality, In summary, most of the empirical literature in the past nine yearsevaluated in this study shown that the debate on the impact of modes of globalization, either economic globalization, Political globalization or otherwise is still controversial and inconclusive. But there was a large consensus that the impact of globalization betweencountries resulted to higher income growth in developed countries and widening income inequality between less developed countries while a divergence views were concluded on the effect of globalization within countries, in respect to growth, poverty and income inequality. The objective of this paper is to provide strong empirical evidence on this divergent issue, with evidence from the Nigerian Economy.
3. METHODOLOGY 3.1 Model Specification The model I used in this study wasadapted from the works of Agene (2003) and Mahler (2001) who looked at the relationship between income inequality and the main modes/set of globalization, such as economic globalization, political globalization and social globalization between or within country or region across countries. The model II also took a lead from the Mundel Fleming model of open macroeconomic, which advocated that the more open an economy, the higher the rate of economic growth. This openness model is expressed in a function as: Y = f t y , r, mg, f y , in, dps Where Y = Growth rate of GDP t = Index of Trade Openers, i.e total trade to GDP. y r = real exchange rate mg = real growth of money supply f = Ratio of fiscal deficit / surplus to GDP y In = Inflation. Dps = Degree of Political Stability Based on the empirical and theoretical framework models examined. This study derived two models specification to examine the impact of Economic Globalization on economic growth and income inequality in Nigeria, as represented in equation (1 and 2) below:
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INEQit = ∝ + βVit+ eit ………………………………. ……(i) RGDPit = ∝ + βVit+ eit ………………………………………………..(ii) Where INEQit is the dependent variable, representing the income inequality measured by GINI coefficient. The variable Vitis a non-constant vector of i regression for i = 1, 2,...t. Thus, for our empirical estimation, the two models of this study were expressed in the subsequent section. 3.1.1
Model I INEQ = f (TGLOB; FGLOB, DPS, FB, CESS) …………………………….… eqn (iii) The OLS linear regression equation based in the above functional relation was written as: INEQ = β0 + β1FGLOB + β2 FGLOB + β3 DPS + β4 FB + β5 CESS + U …… ……………eqn(iv) Aprion expectations of signs of parameters are stated below: β0< 0 ; β1< 0 ; β2< 0; β3< 0 ; β4< 0, β5< 0 β0< 0 is supported by the Dualist Economy Theory that advocate that if all the workers had been the rural area and engaged a agricultural then income of workers would had been relatively equal. Both β1 and β2 are expected theoretically to be < because of the assumption of neoclassical growth theory who postulated that globalization would guaranteed income equality (convergence) within and between country of the globe. While other parameters of β3, β4 and β5 all were expected to be less than (<0) which assumes reduction in income inequality within the country. The definitions of the variables used in the model I above were expressed as: INEQ = Income Inequality is proxied as Gini coefficient of Nigeria, derived from the World Bank Development Indicators. TGLOB= Trade Globalization, Otherwise known as Trade Liberalization, proxied as sum of total exports and Imports as a ratio of RGDP. FGLOB= Financial Globalization proxied on the ratio of FDI to RGDP. DPS = Degree of Political stability, which measures the number of years of democracy in the country. The presence of democracy is coded as ― 1‖ while non – presence of democracy is coded as ―0‖. FB = Fiscal Balance proxied as index of Good Governance. CESS = Capital Expenditure on Economic Services, representing the infrastructural development, by summing capital expenditure on Power, Telecommunication, Transportation and other Productive Capacity or utilities. Ut = Error term 3.1.2
Model II Y= f t y , fin y , R, ms , f y , Infl, DPS ……………………………………… (V) The OLS linear regression equation based in the above functional relation was expressed as: GRGDP = β0 + β1 Where GRGDP = T Y Fin y
= =
T Y
+ β2
Fin y
+ β3R + β4Ms + B5
F Y
+ β6Infl + β7DPS + et ……… (vi)
Growth Rate of RGDP Index of Trade Globalization (openness) proxied as ratio of total trade (Export = import) to RGDP. Index of Financial Globalization Proxied as ratio of FDI to RGDP
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R= Exchange Rate in nominal value Ms = Money supply in nominal value. F = Ratio of fiscal deficit/surplus (fiscal balance) to RGDP Y Infl = Inflation Rate DPS = Degree of Political Stability. Aprioriexpectations of signs of parameters were stated below: Β0>0 ; B1> 0; β2> 0 ; β3> 0 ; β4> 0 ; β5> 0 and β6 < 0. 3.2 Hypothesis Testing The specified regression model of eqn (4) and (6) demonstrated the empirical testing of the underlisted hypotheses of the study: Hypothesis I: Economic Globalization does not cause income inequality within Nigeria. Hypothesis II: Economic Globalization does not lead to economic growth of Nigeria. 3.3 Estimation Techniques and Data Sources Equation 4 and 6 were estimated by the Ordinary Least Square (OLS) method through E-views software 7.0. The annual time series data for this study are sourced from the World Bank Development Indicators (2013), the Central Bank of Nigeria (CBN) Statistical Bulletin (2010) and National Bureau of Statistics (NBS) Publications (2010) for the period range of 1986 – 2010.
4. PRESENTATION AND DISCUSSION OF RESULTS This section present the results of the OLS for the model as specified in equation 4 and 6. The results are presented in table 4.1 and 4.2 as estimated through 7.1 E-view computer packages. 4.1 Table I: OLS (Model I) Dependent Variable: I Method: Least Squares Date: 06/06/13 Time: 16:03 Sample: 1986 2010 Included observations: 25 Variable Coefficient
Std. Error
t-Statistic
Prob.
C TGLOB FGLOB DPS FB CEES
38.88248 -0.469687 22.37124 0.665468 -2.11E-06 2.11E-06
0.891664 0.135643 4.091203 1.430602 2.23E-06 6.47E-06
43.60665 -3.462668 5.468132 0.465167 -0.945786 0.326599
0.0000 0.0026 0.0000 0.6471 0.3561 0.7475
R-squared Adjusted R-squared S.E. of regression Sum squared resid Log likelihood F-statistic Prob(F-statistic)
0.699357 0.620241 2.042178 79.23936 -49.89343 8.839581 0.000181
Mean dependent var S.D. dependent var Akaike info criterion Schwarz criterion Hannan-Quinn criter. Durbin-Watson stat
43.48800 3.313900 4.471474 4.764005 4.552610 1.900255
Source: Authors‘ Computation
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From the above table, the result of the regression analyses shows that the correlation coefficient and coefficient of determination of this model are 83.6% and 69.9% respectively. This implies that according to a priori expectation and conformity with empirical evidence that there was a strong relationship between income inequality and economic globalization within countries. The result shows a degree of strong correlation coefficient (R) of 83.6% between income inequality and presence of economic globalization in Nigeria between 1986 and 2010. Furthermore, the result of coefficient of determination (R2) shows that the explanatory variables explained a total variation of 69.9% (percent) in the dependent variable (Income Inequality). This implies that the widening income inequality was as a result of the presence of included explanatory variable such as economic globalization, poor infrastructural facilities and political instability or weak democracy in the country, Nigeria between 1986 and 2010. Therefore, the result shows a good fit of the model. On a priori ground, only trade globalization and fiscal balance have their expected negative sign which indicates that there is negative relationship between them and income inequality in Nigeria. This implies that the presence of trade liberalization/globalization had contributed towards reducing income inequality between the rich and the poor in Nigeria between 1986 and 2010. Also, the t – statistics of -3.46 shows that the result is statistically reliable and sufficient for reducing income inequality in Nigeria at 5% (percent) level of significance.In addition, the coefficient value of fiscal balance of -2.11 also revealed that the government policies taken within the research time frame had been helpful in reducing income inequality in Nigeria through the financial sectors reforms such on Banks Reform, Insurance Reform, Privatization and Commercialization Policy, all and more had helped to reduce the income inequality in Nigeria between 1986 and 2010. However, the t – statistics value of -0.945 shows that the result is not statistically reliable and sufficient to achieve income equality in the Nigeria economy at 5% level of significance, except there is total implementation of these policies rather than the surface scratch approach, due to corruption among the political leaders. The other included regressors in this model disagree with the apriori expectation of negative signs but all shown a positive signs which implies that financial globalization, degree of political stability (DPS) and capital expenditure on economic services (CEES), all have a positive relationship with income inequality in Nigeria between 1986 and 2010. This implies that presence of foreign direct investment (FDI), portfolio investment and others financial globalization as well as weak democracy and lack of adequate infrastructural facilities like good road networks; efficient transportation and communication services and others, all contributed adversely to a raising income inequality between the rich and the poor in Nigeria. It was revealed that out of the three explanatory variables that contributed to income inequality in Nigeria, only financial globalization was highly significant and reliable to have caused a widening Income inequality within the Nigerian Economy between 1986 and 2010. Finally, the F – statistics value of 8.84 with a corresponding low probability value of (0.000181) indicates that the overall model is statistically significant and reliable for both short – run and long – run prediction at 1% and 5% level of significance. Also, the Durbin– Waston (DW) which is 1.900 shows that there is no serial correlation in the model. In summary, the empirical results of this model concluded that economic globalization doescause income inequality within Nigeria between 1986 and 2010. It was further established that financial globalization, in terms of FDI have had a very strong association with increased income inequality while trade globalization, i.e Exports and Imports (trade
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liberalization) had only have a little/small significant association with reduced income inequality in Nigeria between 1986 and 2010. This estimation of this model was in support with Florence et al (2008) that uses panel regressionsbetween 1981 – 2003 within 20 developed and 31 developing countries and found that trade and financial globalization appeared to have opposite effects on income inequality. They revealed that trade globalization leads to reduce income inequality while financial globalization increases income inequality, all at 5% level of significance. 4.2 Table II: OLS (Model II) Dependent Variable: GRGDP Method: Least Squares Date: 06/06/13 Time: 16:57 Sample: 1986 2010 Included observations: 25 Variable
Coefficient
Std. Error
t-Statistic
Prob.
C TGLOB FGLOB R M FBY INFL DPS
0.041590 -0.001787 -0.060322 0.000550 -3.83E-10 0.016076 -4.03E-05 0.031947
0.029150 0.007390 0.119170 0.001010 1.18E-08 0.046375 0.000631 0.093016
1.426777 -0.241827 -0.506189 0.544619 -0.032430 0.346664 -0.063836 0.343461
0.1718 0.8118 0.6192 0.5931 0.9745 0.7331 0.9498 0.7355
R-squared Adjusted R-squared S.E. of regression Sum squared resid Log likelihood F-statistic Prob(F-statistic)
0.283913 -0.010946 0.049557 0.041751 44.46297 0.962878 0.487552
Mean dependent var S.D. dependent var Akaike info criterion Schwarz criterion Hannan-Quinn criter. Durbin-Watson stat
0.052800 0.049288 -2.917037 -2.526997 -2.808857 1.918008
Source: Authors‘ Computation
Table 4.2 above shows that the coefficient of determination (R2) of this Model II is 0.2839 which implies that a weak included explanatory variables.Hence, the model shows a weak goodness of fit in the short – run. This implies that only 28.4 percent of the included explanatory variables explained the growth rate of GDP in Nigeria, while other factors not included, known as stochastic of about 71.6 percent accounted for dependent variable changes in the short – run. Therefore, it is concluded economic globalization does not leads to growth rate of GDP, i.e economic growth, except other proactive actions were implemented in Nigeria between 1986 and 2010. On a priori ground, only exchange rate(R), ratio of fiscal balance to GDP (FBY) and degree of Political stability (DPS) have an insignificant expected positive signs while others like trade globalization, financial globalization, money supply and inflation rate, all had a negative signs. This result confirms with previous studies that the relationship between economic
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globalization and economic growth are inverse in the developing countries, i.e the poor countries, get poorer in term of insignificant economic growth, while the advanced countries, get richer, in the context of economic globalization, as advocated by the anti-globalist and supported by the Dependency Growth theory, that is there is more of divergence in terms of economic growth than convergence among Less Developed Countries. However, the constant value of 0.041 in the model revealed that without economic globalization, the economic growth of Nigeria would be insignificant. Therefore, it becomes imperative for every country to embrace economic globalization philosophy/ ideology because no nation is an inland. Finally, the Durbin – Watson value of 1.918 shows presence of positive autocorrelation and the F – statistics value of 0.9628 is statistically insignificant at P < 0.05. Therefore, it is concluded in this model that economic globalization do not leads to economic growth in Nigeria between 1986 and 2010. This empirical finding was supported with Awe, A. A. (2013) which examines the Impact of FDI on economic growth in Nigeria between 1976 and 2006 using a Two–Stage Least Squares method and found that there exist a negative relationship between economic growth (GDP) and foreign direct investment (FDI).
5. CONCLUSION AND RECOMMENDATION The empirical results of this study from the stand point of both Model I and II revealed that without economic globalization, there would be income inequality within Nigeria but a very insignificant economic growth would be recorded in the Nigeria economy. Hence, no nation is an island, which implies that every nation must embrace economic globalization and tap thegains of economic globalization depending on each nation‘s economic structure.Furthermore, it was established that there was a strong relationship between economic globalization and income inequality in Nigeria. Therefore, it was concluded empirically that economic globalization causes widening income inequality and reduces economic growth in the Nigerian economy due to much emphasis on financial globalization rather than trade globalization as well as macroeconomic imbalances such as poor governance, political instability, inadequate infrastructural facilities and others but to mention few between 1986 and 2010.
Based on the conclusion above, the following recommendations were made to optimize the gains of economic globalization and guaranteed higher economic growth and income equality within the country as follows: Government should encourage a massive Export promotions drive to exploit the gains of trade globalization across African and the World nations, just like China and Japan had dominated all larger markets of the World. Government should encouragedomestic Agricultural Exports among the teeming population of Nigerian citizens, which guarantees lager employment opportunities and reduces or eliminate income inequality as well as achieve a sustained economic growth and development respectively. This is established in the works of Florence et al (2008). Also as advocated by Kuznets (1955), the Government should demonstrate good governance at all tiers of government levels, in terms of protectionist domestic policy, fiscal efficiency, a relative political stability and a sound qualitative education to benefit immensely from the wave of economic globalization in the Nigeria economy. Finally, Government should provide adequate infrastructural facilities, in terms, power stability, good road networks, efficienttelecommunication system and others to benefit immensely from the presence of Foreign Direct Investment (Financial globalization in the country) as supported in the empirical findings as the causes of rising Income Inequality in the Nigerian Economy.
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