The Professional Service Firm (PSF) in a globalised economy: a study of the efficiency of securities firms in an emerging market AbstractThis study explores the efficiency of securities firms in Turkey and offers conceptual and managerial insights utilizing data envelopment analysis. Through a sample of local and foreign owned securities firms in Turkey, we examine the impact of liabilities of foreignness (LOF) and localness (LOL) upon knowledge intensive firm efficiency in an emerging market economy. We have extended this approach through our consideration of liability associated with market globalness (LOMG). Our findings indicate the importance of size for firm efficiency with bank affiliation and foreign ownership also having positive effects on efficiency. Our study makes a contribution conceptually, methodologically and empirically to a growing literature on emerging economies. We also make a valuable addition to the limited empirical work conducted on the securities industry to date. Finally, through our contextualization of Turkish securities firms as professional services firms (PSFs), our research extends the narrow focus on law and accounting which currently dominates the burgeoning research strand on PSFs.

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Purpose – The purpose of this paper is to review the housing sector of Turkey and present the housing development strategies developed by government enterprises for the urban poor in Turkey as successful examples. Design/methodology/approach – The methodology of the paper is descriptive. First of all, the literature on housing finance systems and sources of housing finance are stated. Then, the paper reviews housing finance systems applied in Turkey in the past to solve housing problems. Later, it describes current housing strategy to solve housing problems of low- and middle-income groups and also presents this strategy as a successful model to other countries. Moreover, mortgage law and the current situation of the Turkish housing sector are discussed within the study. Findings – As a result of economic normalization achieved after 2002, mortgage loans extended by commercial banks have increased in Turkey. Besides, governmental institutions, such as Housing Development Administration of Turkey (HDAT) and Istanbul Public Housing Corporation (KIPTAS), apply very extensive projects to allow low- and middle-income groups to have their dwellings. In 2007, the Turkish Parliament enacted mortgage law and defined rules and actors of the mortgage sector. However, as a consequence of economic deterioration in the world economy, mortgage loan receivables-backed securities could not be issued to public yet. Public issuance of mortgage loan receivables-backed securities in the future are expected to direct more long-term funds to the housing sector and also to provide an additional investment instrument for the individual and institutional investors. Originality/value – The housing production and finance models developed by the HDAT and KIPTAS can be good models for the solution of housing problems of urban poor in other countries.

As one of the most important models in the finance literature, the Capital Asset Pricing Model (CAPM) assumes the existence of a positive and linear relationship between the systematic risk and required rates of return on stocks. The model is extensively researched in the academia and frequently used in business world since its development half a century ago. Its popularity comes from the simplification it provides for the complex process of asset pricing by making the assumption that only one single factor affects stock returns. But, as this is an unrealistic assumption, the validity of the model in its standard (unconditional) form is repeatedly rejected by empirical tests. Pettengill et al., (1995) developed an alternative conditional CAPM approach where the standard model is improved by taking bull and bear market conditions into consideration. According to this model, there is a positive (negative) risk-return relationship during up (down) market periods. Using this reasoning, Pettengill et al., (1995) tested up and down market periods separately and reached highly significant results that support CAPM. In this study, both the unconditional and conditional versions of CAPM are tested in the Istanbul Stock Exchange (ISE) for the period of nine years from 2003 to 2011. The test period is divided into four sub-periods. The unconditional CAPM is rejected for the sample period. A result of the conditional test shows that there is a statistically significant conditional relationship during some sub-periods. However, since the risk-return relationship in up and down markets is not symmetric, this conditional relationship does not indicate a positive risk-return tradeoff. Thus, CAPM may not be a useful asset pricing model for the ISE.

Purpose -Factors affecting capital structure choices of Turkish non-financial listed companies are tested in this study. We investigate the relation between firm leverage and firm level variables, expected inflation and GDP growth rates. Methodology -We used annual data of exchange listed non-financial corporations in addition to expected inflation and GDP growth rates. We applied panel regression models to our panel data set of 292 firms. Findings -We found four factors, i.e. profitability, growth (MVA/BVA), tangibility and industry median leverage are effective in explaining capital structures of Turkish listed firms. While profitability and growth have signs in line with the prediction of the pecking order theory, signs of tangibility and industry median leverage favor the trade off theory. We also divided our sample into clusters based on firm size and 2000 -2001 financial crisis and repeated the analysis. Conclusion-Results of this analysis suggest that trade off theory explains better the financing behavior of large-sized firms. Pecking order theory seems to better account for financing behaviors of Turkish firms before 2002; and trade off theory seems to explain better their capital structure choices after the 2000 -2001 financial crisis.