nep-eur New Economics Papers
on Microeconomic European Issues
Issue of 2017‒06‒04
twenty-one papers chosen by
Giuseppe Marotta
Università degli Studi di Modena e Reggio Emilia

  1. How to escape poverty through education?: Intergenerational evidence in Spain By Duarte, Rosa; Ferrando, Sandra; Molina, Jose Alberto
  2. Enhancing Polish firms’ innovation activities in comparison to the other Moderate Innovators countries By Aleksandra Zygmunt
  3. Is a positive link between human development and fertility attainable? Insights from the Belgian vanguard case By Jonas Wood; Sebastian Klüsener; Karel Neels; Mikko Myrskylä
  4. Parental Leave, (In)formal Childcare and Long-term Child Outcomes By Danzer, Natalia; Halla, Martin; Schneeweis, Nicole; Zweimüller, Martina
  5. The financial fragility of Estonian households: Evidence from stress tests on the HFCS microdata By Tairi Rõõm; Jaanika Meriküll
  6. Economic Consequences of Immigration to Austria By Sergej Vojtovic; M?gdaléna Tupá
  7. Regional effectiveness of innovation – leaders and followers of the EU NUTS 0 and NUTS 2 regions By Agata Zoltaszek; Alicja Olejnik
  8. Public beliefs in social mobility and high-skilled migration By Lumpe, Claudia
  9. Post-compulsory education in England: choices and implications By Claudia Hupkau; Sandra McNally; Jenifer Ruiz-Valenzuela; Guglielmo Ventura
  10. Gender as Determinant Factor of Routes for Registered Unemployment Exit By Beata Bieszk-Stolorz
  11. Wage Bargaining Regimes and Firms' Adjustments to the Great Recession By Ronchi, Maddalena; di Mauro, Filippo
  12. Modelling corporate tax reform in the EU: New calibration and simulations with the CORTAX model By Joint Research Center of the European Commission - IPTS
  13. Poland vs Spain in the First Decade After EU Accession. Parallel Convergence Patterns? By Piotr Wojcik
  14. Demand pull instruments and the development of wind power in Europe: A counter-factual analysis By Marc Baudry; Clément Bonnet
  15. The Impact of Studying Abroad on Economic Activity of Graduates By Jacek Liwinski
  16. The effect of investing abroad on investment at home: On the role of technology, tax savings, and internal capital markets By Goldbach, Stefan; Nagengast, Arne J.; Steinmüller, Elias; Wamser, Georg
  17. The role of venture capital funds in developing innovative activities of the European Union countries By Katarzyna Wierzbicka
  18. Family ties: the intersection between data protection and competition in EU Law By Francisco Costa-Cabral; Orla Lynskey
  19. Culture and household saving By Guin, Benjamin
  20. Considering What drivers affect entrepreneurial activity in the transition economies? The case of the Visegrad countries By Justyna Zygmunt
  21. The output effects of tax changes: narrative evidence from Spain By Paula Gil; Francisco Martí; Richard Morris; Javier J. Pérez; Roberto Ramos

  1. By: Duarte, Rosa; Ferrando, Sandra; Molina, Jose Alberto
    Abstract: This paper analyzes the determinants of escaping poverty through education in Spain, with this being the country that, according to Eurostat (2010), is among the top European countries regarding the percentage of the population affected by poverty. Specifically, the paper studies the transmission of poverty over two generations by analyzing the factors that affect the probability of having completed the secondary level of education. To that end, we use the conceptual Quantity-Quality model of Becker-Lewis, empirically estimated by using the Survey of Living Conditions (2011) provided by the Spanish Statistical Institute. Our results confirm the intergenerational transmission of poverty in Spain, in such a way that the probability that the respondent has completed secondary education is determined, although not exclusively, by the family conditions of the respondents during their teenage years.
    Keywords: Poverty, Education, Intergenerational Transmission, Spain.
    JEL: D12 I32
    Date: 2017–05–30
  2. By: Aleksandra Zygmunt (Opole University of Technology, Poland)
    Abstract: Faced with circumstances of rapid changes, the crucial is stimulation of actions aimed at enhancing competitiveness. In this regard, the European Union strategy Europe 2020 should be mentioned. Concerning the role of firms’ innovation activities in economic growth of regions and countries, it is important to explore how enhancing Polish firms’ innovation activities differ between the EU countries with a similar to Poland level of innovation. Thus, the particular emphasis was put on the Moderate Innovators countries.The aim of this paper is to investigate enhancing Polish firms’ innovation activities against those from the other Moderate Innovators countries.The study was based on data from the European Innovation Scoreboard 2016 related to firm activities dimensions: firm investments, linkage & entrepreneurship and intellectual assets. The time period was 2008–2015 and was limited by data availability. To study multivariate analysis and the zero unitarization methods were applied. These methods allowed to multivariate analysis of enhancing firms’ innovation activities in Poland and those from the other EU countries with similar to Poland level of innovation.This paper contributes to the existing literature by providing new insight on understanding the issues related to firms’ innovation activities. The results reveal, among others, that although Polish firms’ innovation activities have improved against those from the other Moderate Innovators counties, it requires further enhancing. The findings have practical and policy implications. It is assumed that the obtained results may be useful for firms, regions and country in enhancing competitiveness.
    Keywords: innovation activities; firm; the European Union; Moderate Innovators countries
    JEL: O30 O52 R11
    Date: 2017–05
  3. By: Jonas Wood; Sebastian Klüsener (Max Planck Institute for Demographic Research, Rostock, Germany); Karel Neels; Mikko Myrskylä (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: It is expected that by the end of the 21 st century the vast majority of the human population will live in densely populated environments that are frequently characterized by low fertility. Belgium constitutes one of the few recently emerged cases, where a densely populated and highly developed country not only escapes from low fertility, but also exhibits positive associations between education and childbearing. It has been argued, that these patterns might be related to Belgium’s extensive policies supporting the reconciliation of family and career goals, and that especially highly educated people are benefiting from these policies. We look into these hypotheses by studying a unique micro-dataset covering all Belgian residents between 2002 and 2005. The main focus is on the relevance of between-municipality variation in economic conditions and social services for understanding variation in second birth risks by educational attainment. Our results suggest that the second birth risks of highly educated women are by far most sensitive to variation in local conditions. Controlling for ethnic composition effects and internal migration, we reveal that a considerable part of the local variation in the educational gradient in second births can be related to a positive link between fertility and economic conditions as well as social services for the highly educated. Low educated mothers, on the other hand, are found to be less likely to progress to a second child in more prosperous municipalities. This provides support for the view that institutional support for families might indeed be very relevant, and this particularly for the highly educated.
    Keywords: Belgium, child care, economic and social development, family policies, fertility determinants
    JEL: J1 Z0
    Date: 2017–05
  4. By: Danzer, Natalia; Halla, Martin; Schneeweis, Nicole; Zweimüller, Martina
    Abstract: We provide a novel interpretation of the estimated treatment effects from evaluations of parental leave reforms. Accounting for the counterfactual mode of care is crucial in the analysis of child outcomes and potential mediators. We evaluate a large and generous parental leave extension in Austria exploiting a sharp birthday cutoff-based discontinuity in the eligibility for extended parental leave and geographical variation in formal childcare. We find that estimated treatment effects on long-term child outcomes differ substantially according to the availability of formal childcare and the mother's counterfactual work behavior. We show that extending parental leave has significant positive effects on children's health and human capital outcomes only if the reform induces a replacement of informal childcare with maternal care. We conclude that care provided by mothers (or formal institutions) is superior to informal care-arrangements.
    Keywords: child development; fertility.; formal childcare; informal childcare; maternal labor supply; parental leave
    JEL: H52 I38 J12 J13 J22
    Date: 2017–05
  5. By: Tairi Rõõm; Jaanika Meriküll
    Abstract: This paper analyses the financial fragility of the Estonian household sector using microdata from the Household Finance and Consumption Survey (HFCS). We use a stress-testing framework where the probability of default is evaluated on the basis of the financial margin (i.e. the ability to service debt from current income) and the availability of financial buffers. The HFCS data from household interviews are complemented with information from administrative registers. This lets us evaluate and compare measures of financial vulnerability that draw on data from different sources. We derive a set of indicators to identify households that are financially distressed and analyse the sensitivity of financial sector loan losses to adverse shocks. The stress-test elasticities are assessed separately for three standardised negative macroeconomic shocks: a rise in interest rates, an increase in the unemployment rate, and a fall in real estate prices. In addition, we evaluate the impact of a simultaneous shock mimicking the dynamics of these three variables during the Great Recession. It is found that: (1) despite there being a lot of households with financial difficulties, the risks for banks from the household sector are limited; (2) financial fragility is strongly negatively related to income; (3) the loan default rate of households is most sensitive to shocks to the unemployment rate and the interest rate, while the loan losses of banks are affected most by real estate price shocks; and (4) compared with the survey data, the information collected from administrative sources points to higher household default rates and larger bank losses.
    Keywords: household financial fragility, stress-testing, household finance and consumption survey, Estonia, measurement error in household surveys
    JEL: D14 E43
    Date: 2017–05–25
  6. By: Sergej Vojtovic (University of Alexander Dubchek in Trencin, Slovakia); M?gdaléna Tupá (University of Alexander Dubchek in Trencin, Slovakia)
    Abstract: Austria and low unemployment rate, higher salaries, more vacancies in comparison to the Slovak Republic together with the system of state benefits and geographical proximity have caused increased interest of Slovaks in work in the given country. The open asylum politics of Austria and Germany is attractive to immigrants from the third-world countries. Based on the analyses of development of work force emigration from the Slovak Republic and immigration to Austria, the study identifies migration trends in both countries. Calculations of migration benefits from the arrival of work force from the Central and East European countries and calculations of losses and benefits from the migration from the third-world countries aim at explaining the development of economical, social and demographic parameters in the country. Mathematic calculations of losses and benefits from migrations for a country and society are also introduced. These are based on the statistical data available from Eurostat, WTO, Statistical Office of the Slovak Republic, Statistic Austria, Ministry of Labour, Social Affairs and Family, World Bank, International Monetary Fund and data acquired from empirical surveys published in scientific publications. The study uses general scientific methods of induction, deduction, scientific abstraction and comparison, analysis and synthesis of selected facts, phenomena and processes. To calculate the data acquired, statistical and mathematical methods and calculations were implemented. The result of the experiment is to create a model approach to the evaluation of economic benefits and losses from work force migration from the Central and East European countries and, at the same time, immigration from the third-world countries. It may be stated that work force migration from Central and East Europe is beneficial for Austria. The study also shows expenses on immigrants while asylum procedures are taking place followed by expenses on their integration into the labor market and society.
    Keywords: migration, migration management, labour migration, work force, target country, source country
    JEL: F22
    Date: 2017–05
  7. By: Agata Zoltaszek (Faculty of Economics and Sociology, University of Lodz); Alicja Olejnik (Faculty of Economics and Sociology, University of Lodz)
    Abstract: Innovation constitutes an important factor for growth in all EU countries. Regions of the EU play a principle role in shaping new innovation trajectories and in bringing out the hidden potential for national growth. However, it is not only the level of innovation that diversifies regions, but also the innovative potential and the level of its realization. Therefore, the aim of this paper is to assess the realization of innovative potential, defined as effectiveness, in EU NUTS 0 and, if possible, NUTS 2 regions. To accomplish this goal a relative effectiveness method in used. The DEA (Data Envelopment Analysis) makes it possible to analyse the relative technical effectiveness based on regional inputs and outputs, without incorporating the legal and technological specifications of innovations, thus treating it like a production process. The inputs of the process are employment in technology and knowledge-intensive sectors and R&D expenditure, while the outputs include the number of patents and GDP. All variables are standardized by the size of the economically active population. DEA results divide regions in to two groups – effective, being the leaders; and ineffective, or followers. The DEA approach was combined and extended by ESDA (Exploratory Spatial Data Analysis) in order to pinpoint spatial patterns of innovation efficiency across NUTS 2 regions. Defining the best practices and implementing the learning-from-the-best policy is important in the process of regional development and specialization
    Keywords: regional innovation, effectiveness, DEA (data envelopment analysis), regional development, spatial autocorrelation, ESDA (exploratory spatial data analysis)
    JEL: C44 C46 C38 O31 O11
    Date: 2017–05
  8. By: Lumpe, Claudia
    Abstract: This paper investigates how beliefs of the destination country's population in social mobility may influence the location choice of high-skilled migrants. We pool macro data from the IAB brain drain dataset with population survey data from the ISSP for the period 1987-2010 to identify the effect of public beliefs in social mobility on the share of high-skilled immigrants (stocks) in the main OECD immigration countries. The empirical results suggest that countries with higher "American Dream" beliefs, i.e., with stronger beliefs that climbing the social ladder can be realized by own hard work, attracted a higher proportion of high-skilled immigrants over time. This pattern even holds against the fact that existing social mobility in these countries is relatively lower.
    Keywords: immigration,public beliefs,social mobility,social status
    JEL: F22
    Date: 2017
  9. By: Claudia Hupkau; Sandra McNally; Jenifer Ruiz-Valenzuela; Guglielmo Ventura
    Abstract: Most students do not follow the ‘academic track’ (i.e. A-levels) after leaving school and only about a third of students go to university before the age of 20. Yet progression routes for the majority that do not take this path but opt for vocational post-compulsory education are not as well-known, which partly has to do with the complexity of the vocational education system and the difficulty of deciphering available data. If we are to tackle long-standing problems of low social mobility and a long tail of underachievers, it is essential that post-16 vocational options come under proper scrutiny. This paper is a step in that direction. We use linked administrative data to track decisions made by all students in England who left compulsory education after having undertaken the national examination – the General Certificate of Secondary Education (GCSE) – at age 16 in the year 2009/10. We track them up to the age of 21, as they progress through the education system and (for some) into the labour market. We categorise the many different types of post-16 qualifications into several broad categories and we look at the probability of achieving various educational and early labour market outcomes, conditional on the path chosen at age 17. We also take into account the influence of demographics, prior attainment and the secondary school attended. Our findings illustrate the strong inequality apparently generated by routes chosen at age 17, even whilst controlling for prior attainment and schooling up to that point
    Keywords: post-16 education; progression routes
    JEL: I20 I21
    Date: 2017–05–10
  10. By: Beata Bieszk-Stolorz (University of Szczecin)
    Abstract: Numerous studies show that men’s and women’s situation on the labour market differs. Women’s disadvantageous position on the labour market has been confirmed by statistical data. Finding a job is just one of many causes why an individual is crossed out from the labour office register. The registered unemployed can retire, apply for invalidity pension, receive early retirement benefits or start full time studies. One of the most common causes of de-registering is the unemployed person’s unjustified refusal to accept a job offer. The above causes are regarded as competing risks of various kinds. The purpose of this article is to assess the effect of the unemployed individual’s gender on the probability and intensity of de-registering from the labour office lists due to finding a job, de-registering or other causes. The study made use of the survival analysis methods. The assessment of the probability of de-registration due to a specific cause was made by means of the cumulative incidence function. The intensity of de-registration was tested with the Lunn-McNeil model. Differences in the effect of gender on the de-registration possibility were tested with the use of Gray’s test. The study was based on individual data of people registered by the Labour Office in Szczecin. Among women, job-finding was the most common cause of de-registration, followed by the removal from the register. In the case of men the order was reversed, the most probable de-registration cause was the removal, followed by job-finding. The remaining causes were of marginal significance, both for men and women. Women took up a job more intensively than men and were less intensively removed from the register. The differences between males and females in the intensities of de-registering due to the remaining causes were not statistically relevant.
    Keywords: competing risk; cumulative incidence function; the Lunn-McNeil model; unemployment; gender
    JEL: C41 J64
    Date: 2017–05
  11. By: Ronchi, Maddalena; di Mauro, Filippo
    Abstract: The paper aims at investigating to what extent wage negotiation set-ups have shaped up firms’ response to the Great Recession, taking a firm-level cross-country perspective. We contribute to the literature by building a new micro-distributed database which merges data related to wage bargaining institutions (Wage Dynamic Network, WDN) with data on firm productivity and other relevant firm characteristics (CompNet). We use the database to study how firms reacted to the Great Recession in terms of variation in profits, wages, and employment. The paper shows that, in line with the theoretical predictions, centralized bargaining systems – as opposed to decentralized/firm level based ones – were accompanied by stronger downward wage rigidity, as well as cuts in employment and profits.
    Keywords: productivity,wage bargaining,firm level analysis,global financial crisis
    JEL: D22 D61 J30 J50
    Date: 2017
  12. By: Joint Research Center of the European Commission - IPTS
    Abstract: This report investigates the economic impact of the European Commission proposal for a common corporate tax base (CCTB) and a common consolidated corporate tax base with formula apportionment (CCCTB) within the EU. Furthermore, on top of the common base, it considers proposals to reduce the debt bias in corporate taxation. To do so, we employ an applied general equilibrium model (CORTAX) covering all EU Member States, featuring different firm types and modelling many key features of corporate tax regimes, including multinational profit shifting, investment decisions, loss compensation and the debt-equity choice of firms.
    Keywords: corporate taxation, CGEM, debt-bias, European Union
    JEL: H25 H26 H68 H87 C68
    Date: 2016–10
  13. By: Piotr Wojcik (University of Warsaw, Poland)
    Abstract: Poland and Spain share many common features resulting both from similarities of historical experience and also cultural, political, socio-demographic factors. Both countries have similar area, population and GDP structure. They also share historical experience related to political and economic transformation after a long period of non-democratic, centralized governments. Therefore the experience of Spanish membership in the EU is often considered as a model for Poland. The purpose of this research is to perform a comparative empirical analysis of income convergence processes in Poland and Spain on a regional level (NUTS3). We aim to verify if and how these processes are related to one another (show similar paths). Special attention is paid to the periods after accession of these countries to the EU. Convergence patterns in both countries are compared with several tools. Spatial econometric model for absolute beta convergence, sigma convergence indicators and the analysis of distribution dynamics – transition matrices. The impact on EU accession on income convergence in Spain was positive both on a national and regional level. Regional convergence processes sped-up and interregional disparities decreased. The poorest subregions had relatively high probability to increase their income and catch-up with initially more developed regions. In the first decade after accession to EU Poland has also achieved a significant improvement of income indicators on a national level. However, empirical analyses of GDP per capita distribution and its dynamics on a regional level in Poland show that the above mentioned progress does not spread out proportionally on all regions. Neither beta nor sigma convergence is observed. Instead, relatively fastest growth of initially richest regions (mostly large cities) introduces convergence of clubs leading to polarization. EU accession accelerated divergence processes in Poland.
    Keywords: Poland vs Spain, parallel regional convergence, convergence of clubs, distribution dynamics, spatial model
    JEL: O15 P25 R11 C21
    Date: 2017–05
  14. By: Marc Baudry; Clément Bonnet
    Abstract: Renewable energy technologies are called to play a crucial role in the reduction of greenhouse gas (GHG) emissions. Since most of these technologies did not yet reach grid parity, public policies can rely on two types of approach to stimulate innovation: supply-push and demand-pull. The latter aims at creating demand for new technologies and at stimulating their diffusion. Nevertheless, due to the complex self-sustained dynamics of diffusion and to spillovers between the countries it is hard to determine whether newly installed capacities are imputable to national support policies and/or to policies implemented by neighbor countries. The paper addresses this problem. A micro-founded model of technology diffusion is developed and calibrated. It captures the influence of demand-pull policies on wind power installed capacities for six European countries over the last decade. A counter-factual analysis is carried out to assess the impact of demand-pull policies on wind power development by taking into account the interplay between national policies via spillovers.
    Keywords: Renewable energy, Technology diffusion, Demand pull instruments
    Date: 2017
  15. By: Jacek Liwinski (Faculty of Economic Sciences, University of Warsaw Ul. Dluga 44/50, 00-241 Warszawa)
    Abstract: Research background: Over 200,000 of European students study abroad under the Erasmus mobility program in the course of their higher education. It seems that employers may treat students' participation in international exchange programs as a signalling tool, since according to them international students’ skills – both cognitive and non-cognitive – are well above the average. On the other hand, students participating in exchange programs underline a positive impact of studying abroad on their personal development, i.e. on their general skills. Thus, from a theoretical point of view we may expect a positive correlation between studying abroad and economic activity after graduation, which follows from both signalling theory and human capital theory. On the average, 54% of European students report that participation in Erasmus exchange program helped them to obtain the first job, but interestingly, those from the CEE countries, including Polish students, report it much more often. Purpose of the article: The aim of this paper is to determine whether studying abroad has an impact on the employment rate of higher education graduates in Poland over the first few years after graduation. Methodology/methods: We used the propensity score matching (PSM) method and data from a representative, nationwide tracer survey of Poles who graduated from secondary schools or higher education institutions over the period of 1998-2005. Findings: The results of the analysis show that Polish students who completed at least one semester of their studies abroad do not benefit in terms of a higher employment rate after graduation.
    Keywords: studying abroad; human capital; graduates; employment rate; PSM method
    JEL: I23 I26 J21 J24
    Date: 2017–05
  16. By: Goldbach, Stefan; Nagengast, Arne J.; Steinmüller, Elias; Wamser, Georg
    Abstract: This paper examines the relationship between foreign and domestic investment activity of multinational enterprises. The empirical analysis is based on micro data of German firms and their operations at home and abroad, including information on investment in fixed assets. The empirical approach, which rests upon extensive and intensive margin variation, is shown to produce very robust results. These suggest a positive relationship between foreign and home investment in real capital. This positive effect seems to be mainly related to additional opportunities for tax planning and better access to financing capital. In contrast, we do not find evidence that improved production processes and technology upgrading cause the positive effect on investment at home. Our empirical approach allows us to distinguish between an extensive and intensive margin effect: setting up a new foreign affiliate leads to an immediate positive effect of about EUR 450,000 additional investment; the investment elasticity at the intensive margin is estimated to be approximately 0.13.
    Keywords: Outward FDI,Multinational Firms,Domestic Investment,Corporate Taxes,Internal Capital Markets,Technology
    JEL: F23 F61 H25 L23
    Date: 2017
  17. By: Katarzyna Wierzbicka (Wydzial Ekonomii i Zarzadzania Uniwersytet w Bialymstoku, Polska)
    Abstract: Venture capital funds are very important in the development of innovative activity of economic entities. The funds contribute to closing the equity gap in the financing of innovative companies. The purpose of the study is to show the role that venture capital funds play in the development and functioning of business entities in EU companies. DEA (Data Envelopment Analysis), a non-parametric decision making unit (DMU), was used to examine the relationship. The study covered the 2010 and 2015 periods. The results confirm the assumption that venture capital funds operate most effectively in the most innovative economies of the EU.
    Keywords: innovativation, venture capital, Innovative activity, efficiency
    JEL: O16
    Date: 2017–05
  18. By: Francisco Costa-Cabral; Orla Lynskey
    Abstract: Personal data has become the object of trade in the digital economy, and companies compete to acquire and process this data. This rivalry is subject to the application of competition law. However, personal data also has a dignitary dimension which is protected through data protection law and the EU Charter rights to data protection and privacy. This paper maps the relationship between these legal frameworks. It identifies the commonalities that facilitate their intersection, whilst acknowledging their distinct methods and aims. It argues that when the material scope of these legal frameworks overlap, competition law can incorporate data protection law as a normative yardstick when assessing non-price competition. Data protection can thus act as an internal constraint on competition law. In addition, it advocates that following the legal and institutional changes brought about by the Lisbon Treaty, data protection and other fundamental rights also exercise an external constraint on competition law and, in certain circumstances, can prevent or shape its application. As national and supranational regulators grapple with the challenge of developing a dynamic information economy that respects fundamental rights, recognition of these constraints would pave the way for a more coherent EU law approach to a digital society.
    JEL: L81
    Date: 2017–02
  19. By: Guin, Benjamin
    Abstract: This paper examines the role of culture in households saving decisions. Exploiting the historical language borders within Switzerland, I isolate the effect of households’ exposure to certain language groups from economic, institutional, demographic and geographic factors for a homogeneous and representative sample of households. The analysis uses the Swiss Household Panel which I complement with geographic and socio-economic data. I show that low- and middle-income households located in the German-speaking part are more than 11 percentage points more likely to save than similar households in the French-speaking part. In line with the existing literature, I show that these differences across language regions are consistent with different distributions of time preferences. By contrast, I do not find clear evidence for risk sharing during times of financial distress. JEL Classification: Z1, D12, E21, D91
    Keywords: culture, household economics, household finance, language, saving
    Date: 2017–05
  20. By: Justyna Zygmunt (Opole University of Technology, Poland)
    Abstract: While a large literature exists linking entrepreneurship with its drivers in developed economies, entrepreneurship issues in the transition economies are still no entirely recognised. The Visegrad countries represent a unique scope for examining drivers affecting entrepreneurial activity in the transition economies, since they faced similarities at the beginning of the transformation. The findings may be supportive in identifying threats and opportunities of the economic development of Central and Eastern Europe regions.This paper contributes to the literature on entrepreneurship by focusing on drivers of entrepreneurial activity in the transition economies. The aim of the paper is to analyse how entrepreneurial activity in respective Visegrad countries is influenced by various drivers.Entrepreneurship activity and its drivers in the Visegrad countries were considered for the 2004-2014 period. Hypotheses were tested with the usage of an Ordinary Least Squared regression. F-test was employed to test estimated regressions. Goodness-of-fit of the regressions was controlled with the coefficient of determination. To check for the collinearity, Pearson’s correlation coefficient was used.In this paper the approach for improving the understanding of issues related to entrepreneurship in the transition economies is made. This paper contributes to the understanding of how entrepreneurship activity in the Visegrad countries is influenced by various drivers. The main finding is that although entrepreneurial activity in the Visegrad countries seems to be influenced by similar drivers that have been identified for developed economies, the way in which respective drivers matters for entrepreneurship is, in certain cases, distinct. The findings may attract attention of policymakers and may be useful in the processes of policy pursuing.
    Keywords: entrepreneurship, transition economies, the Visegrad countries
    JEL: L26 P25 R11
    Date: 2017–05
  21. By: Paula Gil (Universidad Complutense de Madrid); Francisco Martí (Banco de España); Richard Morris (European Central Bank); Javier J. Pérez (Banco de España); Roberto Ramos (Banco de España)
    Abstract: This paper estimates the GDP impact of legislated tax changes in Spain using a newly constructed narrative record for the period 1986-2015. Our baseline estimates suggest that a 1% of GDP increase in exogenous taxes depresses output by around 1.3% after one year, this negative effect fading away at more distant horizons. We also find that the effect of changes in indirect taxes are larger and that, following a tax increase, investment reacts more than consumption. Overall, our set of estimates is consistent with negative output effects triggered by tax increases, yet the quantitative effects are subject to non-negligible uncertainty that is refected in wide confidence bands, in line with the extant literature for other countries.
    Keywords: tax shocks, narrative record, fiscal policy, GDP growth
    JEL: E32 E62 H20
    Date: 2017–05

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