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Eurasian Studies in Business and Economics 4
Series Editors: Mehmet Huseyin Bilgin · Hakan Danis

Mehmet Huseyin Bilgin

Hakan Danis
Ender Demir
Ugur Can Editors

Financial
Environment
and Business
Development
Proceedings of the 16th Eurasia
Business and Economics Society
Conference
Eurasian Studies in Business and Economics 4

Series editors
Mehmet Huseyin Bilgin, Istanbul, Turkey
Hakan Danis, San Francisco, CA, USA

Representing
Eurasia Business and Economics Society
More information about this series at http://www.springer.com/series/13544
Mehmet Huseyin Bilgin • Hakan Danis •
Ender Demir • Ugur Can
Editors

Financial Environment
and Business Development
Proceedings of the 16th Eurasia Business
and Economics Society Conference
Editors
Mehmet Huseyin Bilgin Hakan Danis
Faculty of Political Sciences MUFG Union Bank
Istanbul Medeniyet University San Francisco, California
Istanbul, Turkey USA

Ender Demir Ugur Can

Faculty of Tourism Eurasia Business and Economic Society
Istanbul Medeniyet University Fatih Istanbul, Turkey
Istanbul, Turkey

ISSN 2364-5067 ISSN 2364-5075 (electronic)

Eurasian Studies in Business and Economics
ISBN 978-3-319-39918-8 ISBN 978-3-319-39919-5 (eBook)
DOI 10.1007/978-3-319-39919-5

Library of Congress Control Number: 2016944611

© Springer International Publishing Switzerland 2017

This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of
the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations,
recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission
or information storage and retrieval, electronic adaptation, computer software, or by similar or
dissimilar methodology now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this
publication does not imply, even in the absence of a specific statement, that such names are exempt
from the relevant protective laws and regulations and therefore free for general use.
The publisher, the authors and the editors are safe to assume that the advice and information in this
book are believed to be true and accurate at the date of publication. Neither the publisher nor the
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herein or for any errors or omissions that may have been made.

Printed on acid-free paper

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The registered company is Springer International Publishing AG Switzerland
Preface

This is the fourth issue of the Springer’s series Eurasian Studies in Business and
Economics, which is the official book series of the Eurasia Business
and Economics Society (EBES, www.ebesweb.org). This issue includes selected
papers presented at the 16th EBES Conference that was held on held on May
27–29, 2015, at Bahcesehir University in Istanbul, Turkey, with the support of
the Central Bank of the Republic of Turkey and Istanbul Economic Research
Association. All accepted papers for the issue went through peer-review
process and benefited from the comments made during the conference as well.
During the conference, participants had many productive discussions and
exchanges that contributed to the success of the conference where 273 papers by
478 colleagues from 56 countries were presented. In addition to publication oppor-
tunities in EBES journals (Eurasian Business Review and Eurasian Economic
Review, which are also published by Springer), conference participants were given
opportunity to submit their full papers to this Issue. We regret that we could accept
only a small portion of those papers.
Theoretical and empirical papers in the series cover diverse areas of business,
economics, and finance from many different countries, providing a valuable oppor-
tunity to researchers, professionals, and students to catch up with the most recent
studies in a diverse set of fields across many countries and regions.
The aim of the EBES conferences is to bring together scientists from business,
finance, and economics fields, attract original research papers, and provide them
publication opportunities. Each issue of the Eurasian Studies in Business and
Economics covers a wide variety of topics from business and economics and
provides empirical results from many different countries and regions that are
less investigated in the existing literature. The current issue covers the following
fields:

v
vi Preface

1. Banking and Finance

2. Economics
3. Management
4. Entrepreneurship and Small And Medium-Sized Enterprises
Although the papers in this issue may provide empirical results for a specific
county or regions, we believe that the readers would have an opportunity to catch up
with the most recent studies in a diverse set of fields across many countries and
regions and empirical support for the existing literature. In addition, the findings
from these papers could be valid for similar economies or regions.
On behalf of the Volume Editors and EBES officers, I would like to thank the
host institution Bahcesehir University, our sponsors the Central Bank of the
Republic of Turkey and Istanbul Economic Research Association, all presenters,
participants, board members, and keynote speakers and are looking forward to
seeing you at the upcoming EBES conferences.

Istanbul, Turkey Mehmet Huseyin Bilgin

Eurasia Business and Economics Society

Eurasia Business and Economics Society (EBES) is a scholarly association for

scholars involved in the practice and study of economics, finance, and business
worldwide. EBES was founded in 2008 with the purpose of not only promoting
academic research in the field of business and economics but also encouraging the
intellectual development of scholars. In spite of the term “Eurasia”, the scope
should be understood in its broadest term as having a global emphasis.
EBES aims to bring worldwide researchers and professionals together through
organizing conferences and publishing academic journals and increase economics,
finance, and business knowledge through academic discussions. To reach its goal,
EBES benefits from its executive and advisory boards which consist of well-known
academicians from all around the world. Every year, with the inclusion of new
members, our executive and advisory boards became more diverse and influential. I
would like to thank them for their support.
EBES conferences and journals are open to all economics, finance, and business
scholars and professionals around the world. Any scholar or professional interested
in economics, finance, and business around the world is welcome to attend EBES
conferences. Since 2012, EBES has been organizing three conferences every year:
one in Istanbul (usually in late May or early June) and two in Europe or Asia
(usually in January and October). Since our first conference, 3931 academic papers
have been presented, and also, in a very short period of time, EBES has reached
1460 members from 82 countries.
Since 2011, EBES has been publishing two academic journals. One of those
journals, Eurasian Business Review—EBR, is in the fields of industry and business,
and the other one, Eurasian Economic Review—EER, is in the fields of economics
and finance. Both journals are published biannually, and we are committed to
having both journals included in SSCI as soon as possible. Both journals have
been published by Springer since 2014 and are currently indexed in Thomson
Reuters Emerging Sources Citation Index, EconLit, Google Scholar, EBSCO,
ProQuest, ABI/INFORM, Business Source, International Bibliography of the Social

vii
viii Eurasia Business and Economics Society

Sciences (IBSS), OCLC, Research Papers in Economics (RePEc), Summon by

ProQuest, and TOC Premier.
Furthermore, since 2014, Springer has been publishing a new conference pro-
ceedings series (Eurasian Studies in Business and Economics) which includes
selected papers from the EBES conferences. The 10th, 11th, and 12th and 13th
EBES Conference Proceedings have already been accepted for inclusion in the
Thompson Reuters’ Conference Proceedings Citation Index, and subsequent con-
ference proceedings are in progress.
On behalf of the EBES officers and Board, I sincerely thank you for your
participation and look forward to seeing you at our future conferences.
With my very best wishes,

Jonathan Batten, PhD

President
Contents

Part I Banking and Finance

Estimation of Efficiency Change in the Czech Banking Sector
Employing the Window Malmquist Approach . . . . . . . . . . . . . . . . . . . . . 3
Iveta Palečková
An Assessment of the Paper Industry Firms Listed in Borsa
Istanbul Using Entropy-Based MAUT Method . . . . . . . . . . . . . . . . . . . . 15
Mehmet Apan, Ahmet Oztel, and Mehmet Islamoglu
Impact of Integrated Communication on Entrepreneurial Companies’
Financial Performance: A Developing Economy . . . . . . . . . . . . . . . . . . . 29
Tamara Jovanov Marjanova, Elenica Sofijanova, Ljupco Davcev,
and Riste Temjanovski
Cross-Border Contagion Risk Transmission Through Stock Markets
Channel: The Case of the Baltic Countries . . . . . . . . . . . . . . . . . . . . . . . 43
Vilma Deltuvaitė
The Issue of Convertible Bonds on the Polish Bond Market Catalyst
in the Years 2009–2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Bożena Kołosowska and Agnieszka Huterska
Government Strategies Based on Sukuk Issues . . . . . . . . . . . . . . . . . . . . 67
Piotrowski Dariusz
Business Valuation: Premiums and Discounts in International
Professional Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Olga Ferraro
The Role and Implications of Internal Audit in Corporate
Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
Lucan (Cioban) Alexandra Narcisa and Hlaciuc Elena

ix
x Contents

Financial Liquidity and Profitability Management in Practice

of Polish Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
Katarzyna Goldmann
The Business Audit as an Alternative to Discriminant Analysis
in Assessing Risks of Going Concern . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
Marlena Ciechan-Kujawa

Part II Economics
Finance-Driven Globalization: Empirical Evidence from
the Commonwealth of Independent States . . . . . . . . . . . . . . . . . . . . . . . . 129
Argiro Moudatsou and Georgios Xanthos
Export Diversification in Lithuanian Traditional Technology
Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
Daiva Laskiene, Asta Saboniene, Irena Pekarskiene, and Rozita Susniene
The Impact of Environmental Taxes on Competitive Performance
of Pollution-Intensive Industries Among Transition Economies:
Evidence from Panel Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
Sabina Silajdzic and Eldin Mehic
Modeling of the Natural Resources’ Intensive Use Regions’ Innovative
Development: Problems of Circumpolar Area Innovative System
Formation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171
Taisya Pogodaeva, Dmitry Rudenko, and Daria Zhaparova
Challenges and Possible Consequences of Transatlantic Trade
and Investment Partnership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 189
Hande Kurtul and Erkut Akkartal
The Impact of Economic Globalization on the Labor Market of
an Open Small Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199
Irena Pekarskiene, Daiva Laskiene, Asta Saboniene, and Rozita Susniene
Model of Region’s Food Security in Russia . . . . . . . . . . . . . . . . . . . . . . . 217
Daria Bents and Elena Silova
Human Development and Quality of Institutions in Highly Developed
Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231
Adam P. Balcerzak and Michał Bernard Pietrzak
Financial Sustainability of Funded Pension Systems in OECD
Countries at Demographic Risks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 243
Nepp Alexander
Contents xi

Crude Oil Price Shocks and Macroeconomic Performances

in the ASEAN Economies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253
Giray Gozgor, Youngho Chang, and Mehmet Huseyin Bilgin
Government Debt and GDP Growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267
Nadezhda Semjonova
Oil Spot Prices’ Next Day Volatility: Comparison of European
and American Short-Run Forecasts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285
Tomáš Heryán

Part III Management

The Effects of Public Key Infrastructure (PKI) Implementation on
Process Improvements in Public Authorities: An Empirical Study
of the PKI Implementation in Tax Administration of the Federation
of Bosnia and Herzegovina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 299
Aida Habul, Amila Pilav-Velić, and Mirza Teftedarija
The Features of Family Business in the Country with Transitional
Economy: Russian Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 315
Korchagina Elena and Shilo Pavel
Proximity Offshoring Generating Considerable Savings with
No Significant Increase of Risks or Losses in Quality—Nearshoring
Playing a Key Role on a Business Transformation Program . . . . . . . . . . 325
Jorge F. Guedes and Leandro Pereira
The Identification of Crisis Manager Skills by Using Saaty’s
Method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 341
Marie Mikušová and Andrea Čopı́ková
Learning by Negotiation: Stake and Salience in Implementing
a Journal Management System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 369
Özg€
un Imre
City Logistics: Is Deregulation the Answer? . . . . . . . . . . . . . . . . . . . . . . 385
Antonio Borghesi
Whether the Employee Commitment to Implementation of the
CRM System Contributes to Customer Loyalty? Empirical Analysis
of a Successful CRM Implementation in the Auto Industry
in Bosnia and Herzegovina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401
Aida Habul, Amila Pilav-Velić, and Amina Fejzić
Analysis of the State and Dynamics of Chemical Industry in Russia . . . . . 413
Tatiana Jurievna Kudryavtseva and Iana Vladimirovna Kovalenko
Tacit vs Explicit Knowledge Dichotomy: State-of-the-Art Review
for Technology Transfer Purposes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
Mikus Dubickis and Elı̄na Gaile-Sarkane
xii Contents

The Principles of Establishment of Investment Responsibility

Centres . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435
Neringa Stonciuviene and Erika Januskeviciene
New Challenges in External Environment and Business Strategy:
The Case of Siberian Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 449
Svetlana Kuznetsova and Vera Markova
Best Practices in the Employment of Knowledge Workers 65
and Over and the Benefits of Employing Them (An Empirical
Approach) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 463
Grażyna Bartkowiak
Causes of Inattention on Financial Competency: A Qualitative
Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 473
Omid Mehrabi and Rozeyta Omar
The Marketing Problems of Turkish Movies in Global Markets . . . . . . . 489
Askim Nurdan Tumbek Tekeoglu
Doubts and Risks in the Buying and Purchasing Processes of Business
Buyers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 499
Pia Hautamäki and Ari Alamäki
Towards a Theoretical Framework for Analysing Blogs as
User-Generated Content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 511
Riikka Makinen and Pekka Tuominen
The Impact of Independence and Brand Personality on Brand
Evaluations Among Biculturals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525
Umut Kubat
Natural Resources Management in Tourism: Dimensions and Impact
of Tourist Offer in the Southeastern Europe National Parks . . . . . . . . . . 537
Nedim Suta, Anes Hrnjic, and Amra Banda
Between Teaching, English Language, and Supervisor: Young
Business Scholars Under the Pressure of Transforming Academia . . . . . 563
Anna Ligia Wieczorek and Maciej Mitre˛ga

Part IV Entrepreneurship and Small and Medium-Sized Enterprises

Specific Features of Family Businesses: A Contribution
to Literature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577
Elena Cristiano
Institutional Approach to Enterprise Production Cost Analysis and
Optimization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
Daniel S. Demidenko and Ekaterina D. Malevskaia-malevich
Contents xiii

Russian Business Practice: Issues of Corruption and Trust . . . . . . . . . . . 611

Liudmila Simonova and Dmitry Rudenko
Partnership Cooperation of Companies: Key Characteristics
and Influence to Innovative Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . 623
Almira Yusupova
Erratum to: The Impact of Independence and Brand Personality
on Brand Evaluations Among Biculturals . . . . . . . . . . . . . . . . . . . . . . . . E1
EBES Executive Board
Jonathan Batten, Monash University, Australia
Iftekhar Hasan, Fordham University, USA
Euston Quah, Nanyang Technological University, Singapore
Peter Rangazas, Indiana University-Purdue University Indianapolis, USA
John Rust, Georgetown University, USA
Alexander Tatarkin, Russian Academy of Sciences, Russia
Marco Vivarelli, Catholic University of Milano, Italy

EBES Advisory Board

Hassan Aly, Department of Economics, Ohio State University, USA
Ahmet Faruk Aysan, Central Bank of the Republic of Turkey, Turkey
Michael R. Baye, Kelley School of Business, Indiana University, USA
Idris Bin Jajri, Faculty of Economics and Administration, University of Malaya,
Malaysia
Wolfgang Dick, ESSEC Business School, France
Mohamed Hegazy, School of Management, Economics and Communication, The
American University in Cairo, Egypt
Heather Hopfl, Essex Business School, University of Essex, UK
Cheng Hsiao, Department of Economics, University of Southern California, USA
Philip Y. Huang, China Europe International Business School, China
Irina Ivashkovskaya, State University—Higher School of Economics, Russia
Soo-Wook Kim, College of Business Administration, Seoul National University,
Korea
Christos Kollias, Department of Economics, University of Thessaly, Greece
Ali M. Kutan, Department of Economics and Finance, Southern Illinois University
Edwardsville, USA
William D. Lastrapes, Terry College of Business, University of Georgia, USA
Rita Mårtenson, School of Business, Economics and Law, G€oteborg University,
Sweden
xv
xvi

Panu Poutvaara, Faculty of Economics, University of Munich, Germany

M. Ibrahim Turhan, Borsa Istanbul, Turkey
Wing-Keung Wong, Department of Economics, Hong Kong Baptist University,
Hong Kong
Naoyuki Yoshino, Faculty of Economics, Keio University, Japan

Organizing Committee
Jonathan Batten, PhD, Monash University, Australia
Mehmet Huseyin Bilgin, PhD, Istanbul Medeniyet University, Turkey
Hakan Danis, PhD, Union Bank, USA
Pascal Gantenbein, PhD, University of Basel, Switzerland
Ender Demir, PhD, Istanbul Medeniyet University, Turkey
Orhun Guldiken, University of Arkansas, USA
Ugur Can, EBES, Turkey
Nur Atmaca, EBES, Turkey

Reviewers
Sagi Akron, PhD, University of Haifa, Israel
Ahmet Faruk Aysan, Central Bank of the Republic of Turkey, Turkey
Mehmet Huseyin Bilgin, PhD, Istanbul Medeniyet University, Turkey
Hakan Danis, PhD, Union Bank, USA
Ender Demir, PhD, Istanbul Medeniyet University, Turkey
Pascal Gantenbein, PhD, University of Basel, Switzerland
Orhun Guldiken, University of Arkansas, USA
Peter Harris, PhD, New York Institute of Technology, USA
Mohamed Hegazy, The American University in Cairo, Egypt
Gokhan Karabulut, PhD, Istanbul University, Turkey
Christos Kollias, University of Thessaly, Greece
Davor Labaš, PhD, University of Zagreb, Croatia
Chi Keung Marco Lau, PhD, University of Northumbria, United Kingdom
Gregory Lee, PhD, University of the Witwatersrand, South Africa
Nidžara Osmanagić-Bedenik, PhD, University of Zagreb, Croatia
Euston Quah, PhD, Nanyang Technological University, Singapore
Peter Rangazas, PhD, Indiana University-Purdue University Indianapolis, USA
Doojin Ryu, PhD, Chung-Ang University, South Korea
Manuela Tvaronavičienė, PhD, Vilnius Gediminas Technical University, Lithuania
List of Contributors

Erkut Akkartal International Trade and Logistics Management, Yeditepe

University, Istanbul, Turkey
Ari Alamäki Department of Digital Economy, Haaga-Helia University of Applied
Sciences, Helsinki, Finland
Nepp Alexander Great School of Economics and Management, Ural Federal
University, Yekaterinburg, Russia
Mehmet Apan Faculty of Business, Karabuk University, Karabük, Turkey
Adam P. Balcerzak Department of Economics, Nicolaus Copernicus University,
Toruń, Poland
Amra Banda Faculty of Science, Department of Geography, University of Sara-
jevo, Sarajevo, Bosnia and Herzegovina
Grażyna Bartkowiak Department of Management, Vistula University Warsaw,
Warszawa, Poland
Daria Bents Institute of Economy, Business and Administration, Chelyabinsk
State University, Chelyabinsk, Russia
Mehmet Huseyin Bilgin Faculty of Political Sciences, Istanbul Medeniyet Uni-
versity, Istanbul, Turkey
Antonio Borghesi Department of Business Administration, University of Verona,
Verona, Italy
Youngho Chang Department of Economics, Nanyang Technological University,
Singapore, Singapore
Marlena Ciechan-Kujawa Department of Accounting, Nicolaus Copernicus
University, Torun, Poland

xvii
xviii List of Contributors

Andrea Čopı́ková Faculty of Economics, Department of Management, Technical

University of Ostrava, Ostrava, Czech Republic
Elena Cristiano Department of Business Administration and Law, University of
Calabria, Arcavacata di Rende, Italy
Piotrowski Dariusz Department of Finance, Nicolaus Copernicus University in
Toruń, Toruń, Poland
Ljupco Davcev Faculty of Economics, University “Goce Delcev”, Štip,
Macedonia
Vilma Deltuvaitė Department of Finance, School of Economics and Business,
Kaunas University of Technology, Kaunas, Lithuania
Daniel S. Demidenko Department of Finance and Monetary Circulation, Institute
of Industrial Economics and Management, Peter the Great St. Petersburg Polytech-
nic University, St. Petersburg, Russian Federation
Mikus Dubickis Faculty of Engineering Economics and Management, Riga Tech-
nical University, Riga, Latvia
Hlaciuc Elena Accounting and Finance Department, Stefan cel Mare University,
Suceava, Romania
Korchagina Elena Department of Management, National Research University
Higher School of Economics, Moscow, Russia
Amina Fejzić School of Economics and Business, University of Sarajevo, Sara-
jevo, Bosnia and Herzegovina
Olga Ferraro Department of Business Administration, University of Calabria,
Rende, Italy
Elı̄na Gaile-Sarkane Faculty of Engineering Economics and Management, Riga
Technical University, Riga, Latvia
Katarzyna Goldmann Department of Accounting, Nicolaus Copernicus Univer-
sity, Toruń, Poland
Giray Gozgor Faculty of Political Sciences, Istanbul Medeniyet University,
Istanbul, Turkey
Jorge F. Guedes Business Research Unit—BRU-IUL, ISCTE—Instituto
Universitário de Lisboa, Lisbon, Portugal
Aida Habul Department of Management and Information Technology, School of
Economics and Business, University of Sarajevo, Sarajevo, Bosnia and
Herzegovina
Pia Hautamäki Department of Business, Haaga-Helia University of Applied
Sciences, Helsinki, Finland
List of Contributors xix

Tomáš Heryán Department of Finance and Accounting, School of Business

Administration in Karviná, Silesian University, Opava, Czech Republic
Anes Hrnjic Department of Management and Organization, School of Economics
and Business, University of Sarajevo, Sarajevo, Bosnia and Herzegovina
Agnieszka Huterska Faculty of Economic Sciences and Management, Nicolaus
Copernicus University, Toruń, Poland
Özgün Imre Industrial Economics, IEI, Linköping University, Linköping,
Sweden
Mehmet Islamoglu Faculty of Business, Karabuk University, Karabük, Turkey
Erika Januskeviciene Department of Economics, Accounting and Finance,
Aleksandras Stulginskis University, Akademija, Lithuania
Bożena Kołosowska Faculty of Economic Sciences and Management, Nicolaus
Copernicus University, Toruń, Poland
Iana Vladimirovna Kovalenko Engineering and Economic Institute, Peter the
Great St. Petersburg Polytechnic University, Saint Petersburg, Russia
Umut Kubat Business School, Yildirim Beyazit University, Ankara, Turkey
Tatiana Jurievna Kudryavtseva Engineering and Economic Institute, Peter the
Great St. Petersburg Polytechnic University, Saint Petersburg, Russia
Hande Kurtul International Trade and Logistics Management, Yeditepe Univer-
sity, Istanbul, Turkey
Svetlana Kuznetsova Institute of Economics and Industrial Engineering SB RAS,
Novosibirsk State University, Novosibirsk, Russia
Daiva Laskiene Department of Economics, Kaunas University of Technology,
Kaunas, Lithuania
Riikka Makinen School of Management, University of Tampere, Tampere,
Finland
Ekaterina D. Malevskaia-malevich Department of Finance and Monetary Circu-
lation, Institute of Industrial Economics and Management, Peter the Great St.
Petersburg Polytechnic University, St. Petersburg, Russian Federation
Tamara Jovanov Marjanova Faculty of Economics, University “Goce Delcev”,
Štip, Macedonia
Vera Markova Institute of Economics and Industrial Engineering SB RAS,
Novosibirsk State University, Novosibirsk, Russia
Eldin Mehic Department of Economic Theory and Policy, University of Sarajevo,
School of Economics and Business, Sarajevo, Bosnia and Herzegovina
xx List of Contributors

Omid Mehrabi Faculty of Management, Universiti Teknologi Malaysia (UTM),

Skudai, Johor, Malaysia
Marie Mikušová Faculty of Economics, Department of Management, Technical
University of Ostrava, Ostrava, Czech Republic
Maciej Mitre˛ga Faculty of Informatics and Communication, University of Eco-
nomics in Katowice, Katowice, Poland
Argiro Moudatsou Business Administration Department, School of Accounting
and Management, Technological Educational Institute of Crete, Heraklion, Greece
Hellenic Open University, Patra, Greece
Lucan (Cioban) Alexandra Narcisa Accounting and Finance Department, Stefan
cel Mare University, Suceava, Romania
Rozeyta Omar Faculty of Management, Universiti Teknologi Malaysia (UTM),
Skudai, Johor, Malaysia
Ahmet Oztel Faculty of Economics and Administrative Sciences, Bartın Univer-
sity, Bartın, Turkey
Iveta Palečková Department of Finance and Accounting, Silesian University,
School of Business Administration, Opava, Czech Republic
Shilo Pavel Department of Management, National Research University Higher
School of Economics, Moscow, Russia
Irena Pekarskiene Department of Economics, Kaunas University of Technology,
Kaunas, Lithuania
Leandro Pereira Business Research Unit—BRU-IUL, ISCTE—Instituto
Universitário de Lisboa, Lisbon, Portugal
Michał Bernard Pietrzak Department of Econometrics and Statistics, Nicolaus
Copernicus University, Toruń, Poland
Amila Pilav-Velić Department of Management and Information Technology,
School of Economics and Business, University of Sarajevo, Sarajevo, Bosnia and
Herzegovina
Taisya Pogodaeva Department of International Economics and Business, Tyumen
State University, Tyumen, Russia
Dmitry Rudenko Department of International Economics and Business, Tyumen
State University, Tyumen, Russia
Asta Saboniene Department of Economics, Kaunas University of Technology,
Kaunas, Lithuania
Nadezhda Semjonova Department of Corporate Finance and Economics, Riga
Technical University, Riga, Latvia
List of Contributors xxi

Sabina Silajdzic Department of Economic Theory and Policy, University of

Sarajevo, School of Economics and Business, Sarajevo, Bosnia and Herzegovina
Elena Silova Institute of Economy, Business and Administration, Chelyabinsk
State University, Chelyabinsk, Russia
Liudmila Simonova Department of International Economics and Business,
Tyumen State University, Tyumen, Russia
Elenica Sofijanova Faculty of Economics, University “Goce Delcev”, Štip,
Macedonia
Neringa Stonciuviene Department of Economics, Accounting and Finance,
Aleksandras Stulginskis University, Akademija, Lithuania
Rozita Susniene Department of Economics, Kaunas University of Technology,
Kaunas, Lithuania
Nedim Suta Faculty of Science, Department of Biology, University of Sarajevo,
Sarajevo, Bosnia and Herzegovina
Mirza Teftedarija Tax Administration, Federation of Bosnia and Herzegovina,
Sarajevo, Bosnia and Herzegovina
Askim Nurdan Tumbek Tekeoglu Business Administration, Istanbul Ticaret
University, Istanbul, Turkey
Riste Temjanovski Faculty of Economics, University “Goce Delcev”, Štip,
Macedonia
Pekka Tuominen School of Management, University of Tampere, Tampere,
Finland
Anna Ligia Wieczorek Faculty of Foreign Languages, University of Silesia in
Katowice, Katowice, Poland
Georgios Xanthos Business Administration Department, School of Accounting
and Management, Technological Educational Institute of Crete, Heraklion, Greece
Almira Yusupova Economic Department, Institute of Economics and Industrial
Engineering SB RAS, Novosibirsk State University, Novosibirsk, Russia
Daria Zhaparova Department of International Economics and Business, Tyumen
State University, Tyumen, Russia
 Part I
Banking and Finance
Estimation of Efficiency Change in the Czech
Banking Sector Employing the Window
Malmquist Approach

Iveta Palečková

Abstract The aim of this chapter is to examine efficiency change in the Czech
banking sector using the Window Malmquist approach within the period
2004–2013. We use the Window Malmquist model to estimate efficiency change
of commercial banks in the Czech Republic. The Window Malmquist index is
determined in order to investigate the levels of and the changes in the efficiency of
the Czech commercial banks over the analysed period. By this approach, the
technical efficiency is examined sequentially with a certain window width
(i.e. the number of years in a window) using a panel data of the Czech commercial
banks. The Window Malmquist index is based on Data Envelopment Analysis
(DEA) models. We found that the average Window Malmquist index reaches the
annual average growth of 5 % in CCR and 3 % in BCC models. This positive
efficiency change was caused by average annual growth of technological change.
In the period 2010–2013, the positive value of Window Malmquist index was as a
result of positive value of efficiency change (catch-up effect).

Keywords Banking sector • Czech Republic • Data Envelopment Analysis •

Window Malmquist index

1 Introduction

The aim of this chapter is to examine efficiency change in the Czech banking sector
using the Window Malmquist approach within the period 2004–2013. For the
empirical estimation, we applied Window Malmquist index (WMI) on the data of
commercial banks in the Czech Republic. The Window Malmquist index is
constructed as a combination of Window Data Envelopment Analysis and the
Malmquist index approach. The Window Malmquist index is determined in order
to analyse the changes in the efficiency of the Czech commercial banks over the
analysed period. By this approach, the technical efficiency is analysed sequentially

I. Palečková (*)
Department of Finance and Accounting, Silesian University, School of Business
Administration, Opava, Czech Republic
e-mail: paleckova@opf.slu.cz

© Springer International Publishing Switzerland 2017 3

M.H. Bilgin et al. (eds.), Financial Environment and Business Development,
Eurasian Studies in Business and Economics 4, DOI 10.1007/978-3-319-39919-5_1
4 I. Palečková

with a certain window width using a panel data of the Czech commercial banks. The
Window Malmquist index is based on Data Envelopment Analysis (DEA) models.
The DEA measures efficiency of a homogeneous set of decision-making units
(DMUs) in their use of inputs to produce outputs. We use two models of DEA
approach, especially CCR model and BCC model that differ in returns to scale
assumption.
In empirical analysis, there is a lack of studies in banking sectors examining
efficiency change, which creates an opportunity for this research. According to the
author’s awareness, in empirical literature only a few studies exist, which estimated
efficiency change in banking sectors of V4. Řepková (2012) estimated efficiency
change in the Czech banking sector using Malmquist index. Hančlová and
Stanı́čková (2012) and Palečková (2015) measured the efficiency change in
Visegrad countries and Lyroudi and Angelidis (2006) estimated efficiency change
of selected countries of the European Union.
According to the author’s awareness, in empirical literature, any study which
applied the Window Malmquist on the Czech banking sector does not exist. The
Window Malmquist index was used by Rezitis (2010) who applied this model to
measure changes in agricultural Total Factor Productivity in the USA and nine
European countries.
The structure of the chapter is as follows. Second section describes empirical
analysis about efficiency of the Czech banking industry. Next section presents
methodology and data, the Data Envelopment Analysis, the Window Malmquist
index and selection of variables. Section 4 reveals empirical analysis and results
and section five concludes the chapter with summary of key findings.

2 Literature Review

Several empirical studies of the efficiency of the Czech banking sector exist and we
refer to some of them. Stavárek and Polouček (2004) found that the Czech banking
sector was on average marked as the most efficient. Stavárek (2005) examined
efficiency of commercial banks in the group of Visegrad countries before joining
the EU. His conclusion was that the Czech banking sector was the most efficient.
Melecký and Stanı́čková (2012) also estimated banking efficiency of Visegrad
countries and evaluated the Czech banking sector as highly efficient.
Staněk (2010) found that the efficiency of the banking sector in the Czech
Republic has improved in the last 10 years. Also, Stavárek and Řepková (2012)
confirmed that banking efficiency increased in the Czech Republic during the
period 2000–2010.
Andries and Cocris (2010) concluded that the Czech banks were inefficient from
the perspective of costs. Anayiotos et al. (2010) claimed that the efficiency in
banking sectors decreased during the pre-crisis boom and also during the crisis.
Řepková (2014) used the DEA window analysis approach and found that Czech
commercial banks were efficient. Also, Řepková (2013) estimated the Czech
Estimation of Efficiency Change in the Czech Banking Sector Employing the. . . 5

banking sector using the Dynamic DEA and she examined that banking efficiency
slightly increased within the period 2001–2011.
The empirical literature review concluded that most of the empirical studies
estimated banking efficiency. Conclusion of the literature review is that the Czech
banking efficiency increased during last years. But only a few studies examined the
efficiency change in the Czech banking sector. The contribution of this chapter is
the fact that the Window Malmquist will be applied on the data of the commercial
banks in the Czech banking industry.

3 Methodology and Data

This study employed two approaches, namely the Data Envelopment Analysis
window approach and the Malmquist index measurement. This combined method
is referred to as the Window Malmquist Index.

3.1 Data Envelopment Analysis

Cooper et al. (2007) described the Data Envelopment Analysis (DEA) as the
mathematical programming techniques which can handle large numbers of vari-
ables and relations, and this relaxes the requirements that are often encountered
when one is limited to choosing only a few inputs and outputs because the
techniques employed will otherwise encounter difficulties. DEA was developed
by Charnes et al. (1978) to evaluate the relative efficiency of a group of decision-
making units (DMUs). Seiford and Thrall (1990) stated that the DEA measures the
efficiency of a DMU relative to other similar DMUs with the simple restriction that
all DMUs lie on or below the efficiency frontier. Charnes et al. (1995) described
that the main advantage of Data Envelopment Analysis is that this approach
identifies, for inefficient DMUs, the sources and level of inefficiency for each of
the inputs and outputs.
The CCR (Charnes et al. 1978) method is a model with assumption of constant
returns to scale (CRS) and it delivers the overall technical efficiency. Banker
et al. (1984) extended the CCR model with assumption of variable return to scale
(VRS) and the resulting model is called BCC (Banker, Charnes and Cooper) model.
DEA begins with a fractional programing formulation as summarized by
Stavárek and Řepková (2012). We assume that there are n DMUs to be evaluated.
DMUj consumes xij amounts of input to produce yrj amounts of output. We assume
that these inputs, xij, and outputs, yrj, are non-negative and each DMU has at least
one positive input and output value. The productivity of a DMU can be formulated
as:
6 I. Palečková

P
s
ur yrj
r¼1
hj ¼ P
m ; ð1Þ
vi xij
i¼1

In the equation (1), u and v are the weights classified to each input and output. By
using mathematical programming techniques, DEA optimally assigns the weights
subject to the following restrictions. The weights for each DMU are assigned
subject to the constraint that any other DMU has no efficiency higher than 1 if it
uses the same weights, suggesting that efficient DMUs will be equal to 1. We can
write the function of DMU as the ratio of the total weighted output divided by the
total weighted input:

P
s
ur yr0
max h0 ðu; vÞ ¼ r¼1
P
m ; ð2Þ
vi xi0
i¼1
P
s
ur yrj
subject to r¼1  1, j ¼ 1, 2 . . . , j0 , . . . , n; ð3Þ
P
m
vi xij
i¼1

ur  0, r ¼ 1, 2, . . . , s; ð4Þ
vi  0, i ¼ 1, 2, . . . , m; ð5Þ

where h0 indicates the estimated technical efficiency of DMU0, ur and vi denote

weights to be optimized, yrj is the amount of output of the rth type for the jth DMU,
xij is the amount of input of the ith type for the jth DMU, r is the s different outputs,
i is the m different inputs and j denotes the n different DMUs (Stavárek and
Řepková 2012).

3.2 Window Malmquist Index

The Window Malmquist index estimates efficiency change of a DMU between two
time periods. The Malmquist index is based on DEA model. Malmquist index
breaks down into various components. The index provides a useful method of
distinguishing between changes in technical efficiency, pure technical efficiency,
scale, total factor productivity (TFPC) and shifts in the efficiency frontier (techno-
logical change) over time. WMI could be presented as the product of catch-up and
frontier-shift terms. The catch-up (or recovery) term shows the degree to which a
DMU improves or worsens its efficiency. The frontier-shift (or innovation) term
characterized the change in the efficiency during the two periods (Cooper
Estimation of Efficiency Change in the Czech Banking Sector Employing the. . . 7

et al. 2007). This WMI is the geometric mean of two indices, one evaluated with
respect to the technology (efficiency frontier) in the current period t and the other
with respect to the technology in the base period s (Coelli et al. 1998).
The original idea of the Malmquist index was presented by Malmquist (1953).
Malmquist indices were introduced by Caves et al. (1982). Fare et al. (1992)
showed that the MI can be calculated using a non-parametric DEA approach,
given that suitable panel data are available and they applied DEA for determining
the Malmquist index. They assumed constant returns to scale. Next, Fare
et al. (1994) reflected variable return to scale and presented an extended decompo-
sition of the MI with another important factor capturing change in scale efficiency.
Following Fare et al. (1994), we used Data Envelopment Analysis approach to
construct an input-based Malmquist index between period t (the base period) and
period s:
 t s s 1
DI ðy ; x Þ DIs ðys ; xs Þ 2
M I ðy ; x ; y ; x Þ ¼
s s t t
 ; ð6Þ
DIt ðyt ; xt Þ DIs ðyt ; xt Þ

where MI ð ∙ Þ is the input-oriented MI, DIt ðys ; xs Þ is the distance function presenting a
maximal proportional reduction of the period s inputs under the period t technology.
The distance function is written as follows:

DIt ðys ; xs Þ ¼ min θ; ð7Þ

θ, λ

subject to yis  λY t ; ð8Þ

θxis  λX ; t
ð9Þ
λi  0, i ¼ 1, . . . n; ð10Þ

where θ is a scalar and λ is a constant vector. The value of θ obtained is the

component score of the ith firm. X and Y denote vectors of input and output, and the
volumes of the ith input consumed and output generated by the DMU0 are denoted
by x and y, respectively.
The above measure actually is the geometric mean of two Malmquist produc-
tivity indexes. Fare et al. (1992) define that MI > 1 means productivity gain, MI
< 1 denotes productivity loss and MI ¼ 1 shows no change in efficiency from time
t to s. Relaxing Caves et al.’s (1982) assumption that DIt ðyt ; xt Þ and DIs ðyt ; xt Þ should
equal to 1, and allowing for technical inefficiency, Fare et al. (1992) decomposed
their MI into two components:
 12  1
DIt ðys ; xs Þ DIs ðys ; xs Þ DIs ðys ; xs Þ DIt ðys ; xs Þ DIt ðyt ; xt Þ 2
MI ¼  ¼  : ð11Þ
DIt ðyt ; xt Þ DIs ðyt ; xt Þ DIt ðyt ; xt Þ DIs ðys ; xs Þ DIs ðyt ; xt Þ
8 I. Palečková

Table 1 Descriptive Variable Deposits Labour Loans NII

statistics of inputs and outputs
Mean 156845.1 2070.701 108460.7 5970.851
Median 52364.7 735 39059 1508.6
Maximum 636662 8525 472886 29460
Minimum 111.5 20.5 0 2
St. Dev. 192395.1 2518.894 128213.2 7735.203

DIs ðys ;xs Þ

The first component EC ¼ presents the technical efficiency change. The
DIt ðyt ;xt Þ
h i1
D t ðys ;xs Þ D t ðyt ;xt Þ 2
second component TCC ¼ DIs ðys ;xs Þ  DIs ðyt ;xt Þ shows the technological change
I I

between time period t and s.

Fare et al. (1992, 1994) described that a value of TCC > 1 shows a positive shift
or technical progress, a value of TCC < 1 indicates a technical regress and value of
TCC ¼ 1 indicates no shift in technology frontier. This chapter used the decom-
position of WMI into technological change and efficiency change.
Window analysis is one of the several methods used to verify efficiency change
over time. The Window Data Envelopment Analysis approach was developed by
Charnes et al. (1985). Each DMU (in this chapter DMU is bank) in a different
period is treated as if it were a different DMU (independent) but remain comparable
in the same window.

3.3 Data and Selection of Variables

The data set used in the study was collected from the annual reports of the Czech
commercial banks within the years 2004–2013. All data are reported on unconsol-
idated basis. Only commercial banks were analysed. As we have reliable data
extracted directly from annual reports, we eliminated the risk that incomplete or
biased data may distort the estimation results.
We start estimation with definition of inputs and outputs. Several main
approaches that exist for definition of the input–output relationship in financial
institution behaviour are described in the empirical literature. We used intermedi-
ation approach which assumes that the banks collect deposits and transform them
into loans. Consistently with this approach, we used two inputs (we used labour and
deposits) and two outputs (we used loans and net interest income). Descriptive
statistics of individual variables is presented in Table 1.
Estimation of Efficiency Change in the Czech Banking Sector Employing the. . . 9

4 Empirical Analysis and Findings

Econometrics software MaxDEA was used for empirical analysis. We estimated the
efficiency of commercial banks using the DEA models, namely, input-oriented
model with constant and variable returns to scale. We used unbalanced panel data
from 13 Czech commercial banks.
Table 2 records average efficiency score in the Czech banking sector estimated
in CCR and BCC models. The average efficiency calculated in CCR model reached
the value 55–84 %. On the other hand, average efficiency with variable return to
scale was between 70 and 95 %. Efficiency in BCC model attained the higher value
than the efficiency in CCR model. The values of efficiency calculated in the BCC
model reached higher values of efficiency than the value in the CCR model. This
situation may occur when a bank, which has been marked as ineffective in the CCR
model due to its inaccurate size, will be marked as efficient in the BCC model. The
average efficiency was increasing during the period 2005–2008. During the period
2009–2011, the average efficiency was decreasing. It was probably caused as a
result of a financial crisis. In 2012 and 2013, the average efficiency increased.
Because of the large volume of information derived from DEA, it may be
difficult to summarize and evaluate. Therefore, it is often helpful to break down
the information using the Window Malmquist index. We calculate Window
Malmquist index from the DEA scores between adjacent periods. The application
of the Window Malmquist index is also conducted in MaxDEA software. The
Window Malmquist change indices are computed using DEA. The indices measure
TFPC for sampled banks in adjacent year during the period from 2004/2005 to
2012/2013. It is decomposed into technological change (TCC) and efficiency
change (EC). Table 3 presents the results of the average Window Malmquist indices
of the banking sector in CCR model during the analysed period.
The average Window Malmquist index reaches the annual average growth of
5 % in CCR model. This positive efficiency change could be divided into its catch-
up and frontier-shift components. The catch-up below 1.00 shows the negative
efficiency change. The mean value of EC (catch-up factor) recorded 1.00 or above
1.00 indicates progress or positive efficiency change. The catch-up effect is covered
by changes in pure and scale efficiency. Pure efficiency change characterizes core
efficiency due to improving of operations and management. Scale efficiency change
is related to returns to scale effects. In the Czech banking sector, the average annual
efficiency change (catch-up) was 1.01 in CCR which indicates positive efficiency
change. When we calculated a year-by-year score, we can see that the efficiency

Table 2 Average efficiency score estimated in CCR and BCC models

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Mean
CCR 0.80 0.70 0.74 0.74 0.84 0.84 0.74 0.55 0.68 0.76 0.73
model
BCC 0.85 0.82 0.82 0.85 0.95 0.92 0.81 0.70 0.77 0.86 0.83
model
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Title: Contraband

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CONTRABAND
 Books by
CLARENCE BUDINGTON KELLAND

Youth Challenges
The High Flyers
The Little Moment of Happiness
Scattergood Baines
Conflict
Contraband
The Hidden Spring
The Source
Sudden Jim

HARPER & BROTHERS

Publishers
 CONTRABAND
By
Clarence Budington Kelland
Author of
“YOUTH CHALLENGES” “THE HIGH FLYERS”
“THE LITTLE MOMENT OF HAPPINESS”
“SCATTERGOOD BAINES”
“CONFLICT” ETC.

Harper & Brothers Publishers

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 CONTRABAND

Copyright, 1923
By Harper & Brothers
Printed in the U.S.A.

First Edition
A-X
CONTRABAND
CONTRABAND
 CHAPTER I
TUBAL gave the key another quarter turn in the quoins and tested
the security of the type in the form with the heel of his grimy hand.
After which he shut his eyes very tight and ran his tongue carefully
over his upper teeth and clucked. Then, in the voice of one who
pronounces a new and wonderful thought he spoke:
“Simmy,” he said, “I dunno. Mebby so—mebby not. There’s p’ints in
favor and p’ints against.”
“I,” said Simmy with the cocksureness of his seventeen years, “am
goin’ to git through. Don’t ketch me workin’ for no woman.”
“She’s one of them college wimmin we’ve been readin’ about.”
“Makes it wuss. Wimmin,” said Simmy, who had given deep thought
to such matters and reached profound conclusions, “hain’t got no
business gittin’ all eddicated up. What they ought to study is cook
books. That’s what I say.”
“Calc’late she’ll be gifted with big words.”
“She’ll wear them kind of glasses,” said Simmy, “that’ll make you
think you’re lookin’ into the show winders of the Busy Big Store if you
come onto her face to face.”
“Simmy, I’ll tell you suthin’.... I’ll be fifty year old, come September,
and I hain’t never married one of ’em yit.”
“I hain’t never goin’ to marry, neither.”
“Shake,” said Tubal.
There ensued a silence while Tubal completed the locking of the
form and secured it on the job press.
“Well,” said Tubal for the hundredth time, “Ol’ Man Nupley’s dead
and gone.”
“Seems like he might ’a’ left this here paper to you ’n’ me that’s
worked and slaved fer him, instid of to this female nephew of
his’n....”
“Niece,” corrected Tubal. “No.... Ol’ Man Nupley wa’n’t fond of me,
but he didn’t owe me no grudge to warrant him wishin’ this thing onto
me. Say, we got out two issues since he passed away, hain’t we?
You ’n’ me—alone and unaided.... Gawd!” Tubal mopped his brow at
recollection of the mental anguish suffered in achieving this feat of
editorship.
“They was dum good issues,” Simmy said, pridefully.
Tubal was not without his pride in the accomplishment—a pride
tinctured with doubt which had been made acute that very morning
when he stopped in the post office for the mail. Certain of the
village’s professional humorists had greeted him with enthusiasm,
and quoted from his works with relish. Tubal had been very much put
to it for copy to fill the paper, and had seized upon every incident,
great or small, as worthy of mention, and as lengthy mention as he
could achieve. He had not used one word where there was a
possibility of enlisting two. For instance, after hearing it quoted, he
felt there was some defect in the style of the personal which stated:
Our fellow townsman, Herbert Whitcomb, has painted his
large and spacious and comfortable residence on Pine
Street near the corner with a coat of white paint. Herb did
the job himself, working evenings, but not Sundays, he
being a Methodist and superintendent of the Sunday
School. Many assembled to watch our Selectman and
tyler of the Masonic lodge (Herb) working at the job of
painting his residence, and thus, besides showing public
spirit in improving the general appearance of our village,
gave many something to do, there being no other
amusement in town. Good for you, Herb. That is the spirit
we like.
He had rather fancied the item about Jim Bagby, and considered he
had filled the maximum space with a minute piece of news.
 Jim Bagby our prominent farmer and Democrat from north
of town, has been dynamiting out the stumps out of the
pasture lot that he has used to pasture cattle. Jim used for
the purpose the best and most powerful brand of dynamite
he could get and the numerous explosions of the
dynamite, each blast removing a stump out of the pasture,
could be heard the length and breadth of the village.
Dynamite, says Jim, is the thing to make the wilderness
blossom like a rose. Another year we hope to see the
pasture out of which Jim dynamited the stumps covered
with the verdure of potatoes or other garden truck.
Tubal recalled the mental anguish which went into the composition of
these and columns of other similar items, and solemnly renounced
forever the dignities of editorship.
“No,” he said, waggling his head gravely, “I calc’late Ol’ Man Nupley
done us a favor by leavin’ this sheet to somebody else.”
“She’ll be comin’ on the noon train,” said Simmy. “That’s when I quit.”
“I s’pose,” Tubal said, as he cocked his eye at a cockroach scurrying
across the floor, “she’ll favor Ol’ Man Nupley in looks. Seems like
that’s a cross heavier ’n any woman ought to bear.” He estimated the
rate of progress of the roach, and, as it were, brought down his bird
with a supremely skillfully aimed deluge of the juice of the weed. “If
wimmin is goin’ to insist on keepin’ on bein’ wimmin, they ought to
see to it you kin look at ’em without sufferin’.”
“Mebby she’s jest comin’ up to sell out,” said Simmy, hopefully.
“Sell? Sell this here rag?... Say!”
“Why not, I’d like to know?”
“Because,” said Tubal, “it owes about two hundred dollars more’n it’s
wuth ... and, now we lost the county advertisin’, it’ll owe a dum sight
more.”
He walked to the door which gave from the front of the shop to the
business and editorial office of the paper, and there he stood as if
upon some vantage point, surveying all that existed of the Gibeon
Free Press. What he saw was not especially inviting; nowhere was
an indication of that romance which is believed to lurk about the
business of disseminating news. The shop wore the haphazard look
of a junk yard, contented to recline and snore in dust and frowziness.
The room wore the air of a place where nothing ever happens and
where nothing is apt to happen.... Just inside the door squatted the
antiquated, limping cylinder press which gave birth weekly to the
Free Press, and which gave off with sullen brazenness the look of
overmuch child-bearing. It knew it was going to break down in the
middle of every run, and it had been cursed at so often and so
fluently that it was utterly indifferent. It was a press without ambition.
Of late years it had gotten into a frame of mind where it didn’t care a
hang whether it printed a paper or not—which is an alarming state of
mind for a printing press to be in.... Over to the right were shelves of
stock, ill sorted, dusty, dog eared at the corners where Tubal had
rubbed his shoulder against them in passing. Thin stacks of red and
blue board, upon which tickets for the Methodist lawn sociable or the
Baptist chicken dinner might be painted, lopped with discouraged
limpness over the edge of the shelving and said improper and
insulting things to the slatternly press. A couple of stones elbowed
each other and a case of type a little further back, and a
comparatively new (and unpaid-for) job press, whose paint still
existed even to shininess in spots, rather stuck up its nose at the rest
of the company and felt itself altogether too good for such society.
There was also a theoretical spittoon—theoretical because it was the
one spot in the room safe from Tubal’s unerring jets of tobacco juice.
These were the high spots arising from a jumble of rubbish which it
was easier to kick about from place to place than to remove
altogether.... Tubal waggled his head.
He turned to survey the business and editorial office, and found
nothing there to uplift his soul. There was a grimy railing of matched
lumber, inside which a table staggered under an accumulation of
exchanges and catalogues and old cuts brought in to pass the
evening of their lives as paper weights. An old black-walnut desk
with a bookcase in its second story tried to maintain a faded dignity
beside an old safe from which the combination knob had been
removed for fear somebody would shut and lock it, as once
happened, with disastrous results. On the wall hung a group picture
of the state legislature of 1882. One could have bedded down a cow
very comfortably in the waste paper on the floor.
“Simmy,” said Jake, solemnly, “she’s a hell of a messy place. Seems
like we ought to kind of tidy up some for the new proprietor—or
suthin’. No use, though. Hain’t no place to begin. Only thing wuth
cleanin’ up is the chattel mortgage Abner Fownes holds over the
place....” He turned and scowled at Simmy and smote his hands
together. “By Jing!” he said, “the’s one thing we kin do—we kin wash
your face. That’ll show.”
Simmy responded by jerking his thumb toward the front door, before
which two men had paused, one a diminutive hunchback, the other
an enormous, fleshy individual with a beard of the sort worn, not for
adornment, but as the result of indolence which regards shaving as a
labor not to be endured. The pair talked with manifest excitement for
a moment before they entered.
“Mornin’,” said Tubal.
“Mornin’,” said the corpulent one. The hunchback squinted and
showed his long and very white teeth, but did not respond verbally to
the greeting.
“Say,” said the big man, “seen the sheriff?”
“Why?” replied Tubal.
“’Cause,” said Deputy Jenney, “if you hain’t nobody has.”
“Since last night about nine o’clock,” said the hunchback in the
unpleasant, high-pitched voice not uncommon to those cursed as he
was cursed.
“He got off’n the front porch last night around nine o’clock and says
to his wife he was goin’ out to pump him a pail of fresh water. Didn’t
put on a hat or nothin’.... That’s the last anybody’s seen of him. Yes,
sir. Jest stepped into the house and out of the back door——”
“Mebby he fell down the well,” said Tubal, helpfully.
“His wife’s terrible upsot. I been searchin’ for him since daybreak, but
not a hide or hair kin I find—nor a soul that seen him. He might of
went up in a balloon right out of his back yard for all the trace he’s
left.”
“What d’ye mistrust?” asked Tubal.
“You hain’t seen him?”
“No.”
“Well, say, don’t make no hullabaloo about it in the paper—yit.
Mebby everything’s all right.”
The hunchback laughed, not a long, hearty laugh of many haw-haw-
haws after the fashion of male Gibeon, but one short nasal sound
that was almost a squawk.
“Might be,” said Simmy, “he sneaked off to lay for one of them rum
runners.”
“What rum runners?” said the hunchback, snapping out the words
viciously and fixing his gimlet eyes on the boy with an unblinking
stare.
“The ones,” said Simmy, with perfect logic, “that’s doin’ the rum
runnin’.”
“Hum!... Jest dropped in to ask if you seen him—and to kind of warn
you not to go printin’ nothin’ prematurelike. We’ll be gittin’ along,
Peewee and me.... Seems mighty funny a man ’u’d up and
disappear like that, especial the sheriff, without leavin’ no word with
me.” Deputy Jenney allowed his bulk to surge toward the door, and
Peewee Bangs followed at his heels—a good-natured, dull-witted
mastiff and an off-breed, heel-snapping, terrier mongrel....
“Well,” said Tubal, “that’s that. I hain’t mislaid no pet sheriff.”
“Mebby,” said Simmy, with bated breath, “them miscreants has
waylaid him and masacreed him.”
“Shucks!... Say, you been readin’ them dime-novel, Jesse James
stories ag’in.... Go wash your face.”
In the distance, echoing from hill to hill and careening down the
valley, sounded the whistle of a locomotive.
“On time,” said Tubal.
“And her comin’ on it,” said Simmy.
From that moment neither of them spoke. They remained in a sort of
state of suspended animation, listening for the arrival of the train,
awaiting the arrival of the new proprietor of the Gibeon Free Press....
Ten minutes later the bus stopped before the door and a young
woman alighted. Two pairs of eyes inside the printing office stared at
her and then turned to meet.
“’Tain’t her,” said Tubal.
Tubal based his statement upon a preconception with which the
young lady did not at all agree. She was small and very slender.
Tubal guessed she was eighteen, when, as a matter of fact, she was
twenty-two. There was about her an air of class, of breeding such as
Tubal had noted in certain summer visitors in Gibeon. From head to
feet she was dressed in white—a tiny white hat upon her chestnut
hair, a white jacket, a white skirt, not too short, but of suitable length
for an active young woman, and white buckskin shoes.... All these
points Tubal might have admitted in the new owner of the Free
Press, but when he scrutinized her face, he knew. No relative of Old
Man Nupley could look like that! She was lovely—no less—with the
dazzling, bewitching loveliness of intelligent youth. She was
something more than lovely, she was individual. There was a certain
pertness about her nose and chin, humor lurked in the corners of her
eyes. She would think and say interesting things, and it would be
very difficult to frighten her.... Tubal waggled his head, woman-hater
that he was, and admitted inwardly that there were points in her
favor.
And then—and then she advanced toward the door and opened it.
“This is the office of the Free Press, is it not?” she said.
“Yes ’m. What kin we do for you?”
“I’m not sure. A great deal, I hope.... I am Carmel Lee—the—the new
editor of this paper.”
In his astonishment Tubal pointed a lean, inky finger at the tip of her
nose, and poked it at her twice before he could speak. “You!... You!”
he said, and then swallowed hard, and felt as if he were unpleasantly
suspended between heaven and earth with nothing to do or say.
“I,” she answered.
Tubal swung his head slowly and glared at Simmy, evidently laying
the blame for this dénoûement upon the boy’s shoulders.
“Git out of here,” he whispered, hoarsely, “and for Gawd’s sake—
wash your face.”
Simmy vanished, and Tubal, praying for succor, remained,
nonplused, speechless for once.
“Is that my desk?” asked Miss Lee. “Um!...” Then she won Tubal’s
undying devotion at a single stroke. “I presume,” she said, “you are
foreman of the composing room.”
He nodded dumbly.
“You—you look very nice and efficient. I’m glad I’m going to have a
man like you to help me.... Is it very hard to run a real newspaper?”
“It’s easy. You hain’t got any idea how easy it is. Why, Simmy and
me, we done it for two issues, and ’twan’t no chore to speak of!...
Where’s that Simmy?... Hey, Simmy!”
“He went,” said Miss Lee, “to wash his face.... Now I think I shall go
to the hotel. It’s next door, isn’t it?... After I have lunch I’ll come back,
and we’ll go to work. You’ll—have to take me in hand, won’t you?...
Is this a—a profitable paper?”
“By gosh! it will be. We’ll make her the doggonedest paper ’n the
state. We’ll——”
“Thank you,” said Miss Lee. “Right after lunch we’ll start in.” And with
that she walked daintily out of the office and turned toward the
Commercial House.... Tubal gave a great sigh and leaned on the
office railing.
“Has she gone?” came a whisper from the shop.
“You come here. Git in here where I kin talk to you.”
“Here I be.... Say, when do we quit?”
“Quit? Quit what?”
“Our jobs. We was goin’ to. You ’n’ me won’t work for no woman?”
“Who said so? Who said anythin’ about quittin’, I’d like to know. Not
me.... And say, if I ketch you tryin’ to quit, I’ll skin you alive.... You ’n’
me, we got to stick by that leetle gal, we have.... Foreman of the
composin’ room!... By jing!... Perty as a picture.... By jing!”
“Say, you gone crazy, or what?”
“She’s a-comin’ back right after lunch. Git to work, you. Git this office
cleaned up and swept up and dusted up.... Think she kin work
amongst this filth.... Git a mop and a pail. We’ll fix up this hole so’s
she kin eat off’n the floor if she takes a notion.... Simmy, she’s goin’
to stay and run this here paper. That cunnin’ leetle gal’s goin’ to be
our boss.... Goddlemighty!...”