Browsing by Author "Aikaeli, Jehovaness"

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    Efficiency and the problem of acess liquidity in commercial banks in Tanzania
    (University of Dar es Salaam, 2006) Aikaeli, Jehovaness
    The main objective of this study is to investigate efficiency, and to establish determinants of excess liquidity in commercial banks in Tanzania. The study is motivated by the fact that little is known about efficiency status; and on excess liquidity, the policy concern is that banks are awash with liquidity despite the high demand for credits. Monthly data (for 1998-2004) sourced from the Bank of Tanzania are used. Data Envelopment Analysis is utilized in estimation of technical and scale efficiency. X-inefficiency is estimated using multi-product trans log cost function, while Tobit model analyses the factors driving it. The causes of excess liquidity are examined by autoregressive distributed lag model. From the main conclusions, banks performed fairly well during the period; nevertheless, they have a scope for improving their performance. Technically, they could produce the same amount of outputs with 3-4 percent fewer resources than they employed. Technical inefficiency arose from ineffective use of labor, fixed assets and equipment rather than underutilization of deposits. The overall estimated technological innovation of 6 percent was directly proportional to improvement in banks' factor productivity. Operational or x-inefficiency was less than 10 percent but steadily on increase. Inadequate spending on capital goods, poor labor compensation, and excess liquidity precipitated x-inefficiency. Excess liquidity in banks was influenced by cost of funds, credit risks, cash preference volatility, and the rate of required reserves. Policies encouraging competition, products diversification, risks minimization and proper supervision are recommended.
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    The impact of expected life assurance and pension benefits on household savings: a case study of middle income group in Dar es Salaam.
    (University of Dar es Salaam, 1998) Aikaeli, Jehovaness
    The main objective of this study is to ascertain the impact of expected life assurance and pension benefits on other forms of household savings. This study is based on the substitution hypothesis which is consistent with the standard neoclassical theory that, similar products act as substitutes for each other. Primary data collected from Sinza as a representative area in Dar es Salaam are used in the analysis. A modified Ando-Brumberg-Modigliani life-cycle model is used and the ordinary least squares (OLS) technique is employed in the estimation of the parameters. The major findings show that expected life assurance and pension benefits reduce personal savings held in other forms. Its purport is that, expected benefits from the forms of social security are reasonably dependable for future consumption. In this case, there was lack of evidence to ascertain the theoretical ambiguity on whether changes in lifetime saving due to pension growth induce one to retire early or late. Policies that enforce lucrative business in pension schemes and life assurance are recommended. Among others, privatisation and creation of more competitive business environment have to be implemented for efficiency purposes. With economic changes arising from the current reforms, government withdraws from the business enterprises and the formerly freely offered services are gradually privatised. Government has to therefore, assume a role to educate the people on the importance of saving in social security schemes.