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on Transition Economics |
| By: | Lenka Přečková (Department of Finance and Accounting, School of Business Administration, Silesian University) |
| Abstract: | This paper shall evaluate the level of internal integration among bancassurance products and financial institutions belonging to the financial group Société Générale Group in selected countries of Europe. There shall be selected eight countries which are located in Central and Eastern Europe: the Czech Republic, Slovak Republic, Poland, Romania, Bulgaria, Croatia, Slovenia and Serbia. The research was conducted as of December 2017. This paper aims at determining whether similarities in how the financial group Société Générale Group is organized determine similarities in how bancassurance in the selected countries functions. In order to reach this aim, a critical analysis of bancassurance-related literature shall be performed and a hypothetical basis for the practical evaluation shall be formulated. Characteristics for evaluation of the level of integration inside the financial group, and also within the bancassurance product, shall also be set. In order to evaluate how bancassurance functions in practice, a qualitative research based on data available on web sites and also financial and annual reports shall be used. The qualitative research shall contain a detailed analysis, sorting and a comparison of the set characteristics. Finally, it will be determined which attributes are identical and which are different in the integration of financial groups and bancassurance products. |
| Keywords: | integrated bancassurance product, form of integration, strategic cooperation |
| JEL: | G21 G22 |
| Date: | 2019–06–19 |
| URL: | http://d.repec.org/n?u=RePEc:opa:wpaper:0064&r=all |
| By: | Kuznetsov, Aleksei (Eurasian Development Bank); Berdigulova, Aigul (Eurasian Development Bank) |
| Abstract: | In 2018, the Russian economy grew at its highest rate since 2012. Higher net exports were the main factor behind accelerated growth. Consumer and investment activity remained positive contributors to economic growth. We expect Russia’s GDP growth to slow temporarily, constrained by the increased tax load and the impact of the key rate increase in late 2018. Increased investment expenditures of the federal budget and gradual normalization of monetary policy from 2nd half of 2019 will foster a mid-term economic recovery to the potential rate, that we estimate at 2% per annum. The Russian ruble’s exchange rate became more volatile in 2018 amid exacerbated geopolitical tension. Harsher U. S. sanctions rhetoric caused greater capital outflow from the Russian economy, reflected in quicker weakening of the ruble. Barring additional shocks, we expect the Russian currency to strengthen over 2019 from the level of late 2018, in particular because return on Russian assets will remain high. Inflation accelerated in 2018, driven by a weakening ruble, faster growth of some food prices and price correction in advance of the VAT increase. The increase in inflation in 2nd half of 2018, accompanied by growing inflationary expectations, led the CB RF to raise its key rate twice, by 0.25 pp in September and December, to 7.75% at the end of 2018. We expect the acceleration of inflation to continue into the 1st half of 2019, mainly driven by the VAT increase. Starting in 2nd half of 2019, inflationary pressure will decrease gradually and allow inflation to return to its target level in 2020. As inflation slows, the key rate is expected to return to its neutral level, that we estimate at 6.5– 7%, in 2020. In 2018, the federal budget posted a surplus for the first time since 2011, assisted by a favorable commodity price background in most of 2018. The budget is expected to remain in surplus in the medium term, with oil prices staying above USD 60 per barrel. The budgetary policy focus will gradually move towards higher investment expenses in the coming years, with effects including a higher potential economic growth rate. |
| Keywords: | macroeconomy; forecasting; Eurasia; EAEU countries; economic growth; monetary policy |
| JEL: | E17 E52 E66 O11 |
| Date: | 2019–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:ris:eabrwp:2019_006&r=all |
| By: | Kuznetsov, Aleksei (Eurasian Development Bank); Berdigulova, Aigul (Eurasian Development Bank) |
| Abstract: | In 2018, the Belarusian economy showed a high growth rate as it recovered after the recession in 2015–2016. Economic growth was supported by increasing consumer and investment activity as lending expanded, the population’s income grew, and the real sector’s economic sentiment improved. The economic growth rate in 2018 gradually slowed down as the monetary conditions’ stimulating effect decreased and the low base effect petered out. The EDB predicts Belarusian GDP to increase annually by 1.5–2% in the medium term in the absence of additional stimulation. The Belarusian ruble was highly volatile in 2018. The Belarusian currency was affected by aggravating geopolitical tension that caused the exchange rate of the Russian ruble and other EDB member countries’ currencies to fluctuate. In the medium term, the Belarusian ruble will devalue at a moderate rate as inflation in Belarus stays higher than in its main trade partner countries. Inflation in 2018 kept within the NB RB’s target range, managed by a balanced monetary policy. Yet, after reaching its historic minimum in June and July 2018, inflation began accelerating in the second semester as food and fuel price growth increased and inflation in the RF accelerated while consumer demand remained high. The buildup of inflationary pressure led the NB RB to suspend its refinancing rate reduction cycle in 2nd half of 2018. In 2019, inflation is expected to accelerate temporarily and perhaps exceed its end-of-year target level of 5%. Consumer price growth may be brought about by inflation increasing in the RF, gradual evaluation of the Belarusian ruble, and the persistent inflationary influence of wages. We predict this to be a temporary process, however, and in 2020 and 2021 inflation will be close to the NB RB’s targets. The IBC rate is expected to be in the 10–11% range, which is consistent with its neutral level. The Republic’s budget surplus expanded considerably in 2018 due to temporary factors, including commodity price growth and a high recovery growth rate in the national economy. The budget surplus reduced the country’s need to refinance its public debt. In the medium term, the budgetary and fiscal policy will remain focused on the improvement of fiscal and debt stability. |
| Keywords: | macroeconomy; forecasting; Eurasia; EAEU countries; economic growth; monetary policy |
| JEL: | E17 E52 E66 O11 |
| Date: | 2019–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:ris:eabrwp:2019_003&r=all |
| By: | Ivanov, Bodjidar; Bachev, Hrabrin; Che, Shenquan; Dimitrova, Daniela; Liang, Anze; Mitova, Dilyana; Stoychev, Vasil |
| Abstract: | The research target is to analyse the development degree of the rural tourism in all its varieties in Bulgaria and China, its role for achievement of a sustainable and diversified development, as well as to assess the synergic effects of the protection and restoration of the ecologic and cultural wealth and to create a tourist product for a sustainable and viable rural development. The study was made on the base of a detailed examination of the existing Bulgarian and foreign literature in the area of the sustainable development of the tourism in rural areas. The elaborated methodology provides a reliable and complex assessment of the synergy of tourism development in rural communities on the conservation, the sustainable use of ecological and cultural resources, as well as the contribution to the overall development of the local economy. In the scientific literature and the contemporary scientific thought more attention is paid to the strengths, natural and other conditions to be turned into a driving force for preserving and vitalising rural communities. The tourism is conceived as a sector with a special promising opportunity for the development of these territories. The formation of a sustainable and recognisable tourist product in rural areas is based on multiple elements: climate, locality, sand, sea, landscape, infrastructure, hospitality, life quality, life style, health and regional specificity. For the aims of the study has been chosen two pilot municipalities in Bulgaria – Strelcha and Hissarya. Both municipalities are neighbouring geographically, but belonging to two different administrative regions – Pazardzhik and Plovdiv. The economies of the two pilot municipalities although similar, show several differences as a result of different reasons, analysed in-depth. One feature in common for both pilot regions and one of the most significant resource for the tourism development in these municipalities is the hot mineral springs. The research of the situation and the opportunity of hot water use enable making analysis of the effects and contributions of this resource for the regions. It is established that both in Bulgaria and in China, according to the particularities, similar in nature but different in form and specificity approaches have been applied to create a sustainable tourism product by creating tourist clusters based on the regional resources of the regions, which will lead to the utilisation of potential touristic capital. Wonderful prerequisites are available, which should be examined in a long-term outlook, for Bulgarian natural conditions, specific for rural areas, to become an attractive tourist product for the growing and increasingly developing demand of the Chinese tourist industry and of the rising flow of Chinese travellers. |
| Keywords: | rural tourism, agrarian and rural development, Bulgaria, China |
| JEL: | Q10 Q18 Q5 R1 R11 R2 |
| Date: | 2019–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94403&r=all |
| By: | Eduard Baumohl (Národná banka Slovenska, Bratislava); Ichiro Iwasaki (Institute of Economic Research, Hitotsubashi University, Tokyo, Japan); Evžen Koèenda (Institute of Economic Studies, Charles University, Prague, Czech Republic) |
| Abstract: | We analyze firm survival determinants in four new European Union member states (the Czech Republic, Hungary, Poland, and Slovakia). We employ the Cox proportional hazards model on firm-level data for the period of 2006 to 2015. We show that in all four countries, less concentrated control of large shareholders, higher solvency, and more board directors are linked with the increased probability of firm survival. However, an excessive number of board directors has a detrimental effect. Firms with foreign owners and higher returns on their assets exhibit better survival chances. Conversely, across countries and industries, larger firms and those hiring international auditors have lower probabilities of survival. A number of specific determinants influence firm survival in different ways, emphasizing the importance of country and industry differences when studying firm survival. We also document that in an economic sense, determinants associated with the legal form, ownership structure and corporate governance show the most beneficial effects with respect to firm survival. |
| Keywords: | firm survival, new EU member states, survival and exit determinants, hazards model |
| JEL: | D22 G01 G33 G34 P34 |
| URL: | http://d.repec.org/n?u=RePEc:svk:wpaper:1062&r=all |
| By: | He Zengping; Jia Genliang |
| Abstract: | Local government debt in China is increasing and presents a great threat to China's financial stability. In China's fiscal system, the central government often prioritizes reducing its fiscal deficit and can determine to a great extent the distribution of revenue and expenditure between itself and local governments. There is therefore a tendency for the fiscal burden to be shifted from the central government to the local governments. Resolving China's local government debt problem requires not only strengthening regulation, but also abandoning the central government's fiscal balance target, because this target may make regulation hard to sustain in times of economic downturn. This paper discusses central-local fiscal relations in the framework of Modern Money Theory, suggesting that, because a government with currency sovereignty can always afford any spending denominated in its own currency, China's central government should bear a greater fiscal burden. |
| Keywords: | Local Government Debt; China; Modern Money Theory; Fiscal Systems |
| JEL: | G18 H74 H77 O53 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_932&r=all |
| By: | Aleksandra Majchrowska (University of Lodz); Pawe³ Strawiñski (University of Warsaw) |
| Abstract: | The aim of the paper is to analyse regional diversification of minimum wage workers in the private sector in Poland and identify regions more vulnerable to minimum wage increases. Firstly, we examine the regional differences in the share of minimum wage workers. Secondly, we look at the structure of minimum wage earners. Finally, we use empirical approach analogous to Nestiæ et al. (2018) to identify low-wage sections and low-wage regions. We use individual data from the Structure of Earnings Survey in Poland. The research period covers 2008-2016. Six Polish regions are identified as the low-wage ones: five economically underdeveloped provinces of Eastern Poland and one region located centrally. These regions are characterised not only by high percentage of young people working for the minimum wage, but also high share of prime age and elderly minimum wage workers. High share of minimum wage earners is not only among low-qualified workers, but also among those with secondary education. These are employed in labour intensive, low-wage sections of the economy. What is particularly interesting is the fact that the results are fairly stable over time. To the best of our knowledge this is the first study of such kind not only for Poland but also for other countries. |
| Keywords: | minimum wage, minimum wage workers, low-wage sectors, low-wage regions, Poland |
| JEL: | R23 J31 J82 |
| Date: | 2019–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:ann:wpaper:2/2019&r=all |
| By: | Gunther Schnabl |
| Abstract: | For a long time, China’s impressive growth performance has been driven by investment and high productivity gains. Based on the recent discussion on possible overcapacities and overinvestment in China, the paper investigates the sustainability of China’s investment- and export-driven growth model. It is shown that since the turn of the millennium buoyant capital inflows and low interest rates have been at the roots of overinvestment and misallocation of capital, which necessitated export subsidies to clear markets. The overinvestment boom is argued to have ended around 2014. Since then, the overcapacities have weakened China’s bargaining position in the US-Chinese trade conflict and have tempted the Chinese authorities to postpone a restructuring of the Chinese economy by low-interest credit provision. The resulting gradual reemergence of quasi soft budget constraints is seen to undermine China’s long-term growth potential. |
| Keywords: | China, investment, overinvestment, trade policy, credit growth, rebalancing, soft budget constraints, zombification |
| JEL: | E22 E43 E58 F13 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7642&r=all |
| By: | Burkhanov Aktam; Tursunov Bobir |
| Abstract: | The article discusses the features of mutual funds, examining Russia's experience using an example. The emergence of investment funds in Russia was predetermined by the course of economic reforms taking place during the transition of the Russian economy to market relations. The need for the formation of various forms of ownership, the presence of which is characteristic of market conditions of management, was the prerequisite for the emergence of mechanisms to facilitate the implementation of this process. One of these mechanisms has become an investment fund. The peculiarity of this institute is the purposeful activity of servicing a small investor who invests his money in securities. Widespread in the world and high rates of development of investment funds largely explain the pattern of their emergence in Russia, where the issue of creating such an institution to attract savings to a wide range of small and medium-sized investors, able to ensure high standards of management of attracted assets, has become obvious and highly relevant. Key Words:investment funds, mutual fund, financial market Policy |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:vor:issues:2019-29-12&r=all |
| By: | Kuznetsov, Aleksei (Eurasian Development Bank); Berdigulova, Aigul (Eurasian Development Bank) |
| Abstract: | After two years of economic recovery, GDP growth slowed to 3.5% in 2018, from 4.7% in 2017. The economic slowdown was caused by a decline of production at the Kumtor gold mine and stabilization of the growth rates in other sectors at near potential levels. Domestic demand in 2018 showed unstable growth, reflecting the volatility of households’ real incomes. A slowdown in lending and remittances inflows growth rates in 2018 compared to 2017, as well as deferred demand of the public sector, also constrained domestic demand. The deviation of inflation from the target during 2018 resulted from weak prices in the world food markets as well as from the high base effect in the vegetables and solid fuel segments. The current account deficit expanded as the negative goods and services balance widened, while the net inflow of current transfers remained virtually the same as in 2017. The state budget posted a deficit of 1.1% of GDP in 2018, down from 3.1% of GDP the year before. The decreased State budget deficit resulted from lower public spending and slightly higher budget revenues. The slower growth in budget revenues was due to lower grants received from other countries’ governments and international organizations, while tax revenue growth was unchanged. Public debt decreased in nominal terms, mainly on account of the debt to the Russian Federation being written off pursuant to an agreement between the countries. In May 2018, the National Bank of the Kyrgyz Republic reduced its policy rate from 5.0% to 4.75% as inflation was low, and took a number of decisions concerning the width of the interest band during the year. In 2019, economic activity in the Kyrgyz Republic is projected to accelerate, largely on account of optimistic assessments of its gold production volumes and moderate expansion of public sector demand. In the medium term the economy is expected to grow steadily at near potential rates. The inflation trends will depend on the world food market. According to our assessment, world food prices will start recovering in the 1st half of 2019 and stabilize by early 2020, which, in turn, will shape the growth trajectory of the consumer price index in the Kyrgyz Republic. |
| Keywords: | macroeconomy; forecasting; Eurasia; EAEU countries; economic growth; monetary policy |
| JEL: | E17 E52 E66 O11 |
| Date: | 2019–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:ris:eabrwp:2019_001&r=all |
| By: | Gustafsson, Björn Anders (University of Gothenburg); Sai, Ding (Chinese Academy of Social Sciences) |
| Abstract: | This paper presents several arguments for applying a relative poverty line to urban China. For example between 2002 and 2013 urban residents in China changed their assessment of how much money that is necessary. Data from the China Household Income Project indicate that while, assessed against an absolute poverty line, poverty among Chinese urban residents was already fairly low in 2007, increasing proportions fell under a relative poverty line from 1988 to 2007. Thus income growth in urban China was more rapid in the middle segments of the income distribution that at it's lower segments. In 2013, at least as large fractions of the urban population as in many rich countries were deemed poor in relative terms. We also specify and estimate logit models for 2002 and 2013 after first having divided the samples into children, adults and elderly people. We find that the risk of being relative poor in urban China both years under study was positively associated with lack of work among adult household members, a low education of the household head, living in a low-income city, the number of children, and being aged and not receiving a pension. Pensions for the aged in combination with co-residency with adult children or with other adults have kept poverty rates among the increasing number of elderly in urban China from exceeding those among adults. In contrast, relative poverty rates are somewhat higher among children than among the entire urban population. |
| Keywords: | urban China, poverty, subjective poverty line, children, adults, older people |
| JEL: | I3 I32 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12422&r=all |
| By: | Margit Molnar |
| Abstract: | China’s regions have been experiencing impressive growth over the past decades, but their potentials could be better exploited by creating a single product and labour market. Local protectionism increases transaction costs and hinders competition, thereby taking a toll on productivity. Administrative monopolies have long thrived and are hard to dismantle. Restrictions on the hukou and the fragmented pension system limit labour mobility. Local regulations aim at, among other things, securing the collection of local taxes, without which cities could not afford to offer the same public services to migrants as to urbanites. Hence, dismantling local regulations and creating a single product and labour market needs to go hand-in-hand with the reform of inter-governmental finances. Recent measures on both the product and labour market front appear to aim at making up for the slow progress over the past decade or so. There are signs that these efforts are helping China’s regions at various levels to converge toward each other. Disparities are shrinking faster across provinces, compared to within provinces. Integration of product and labour markets will boost productivity over the medium-to long term by reducing transaction costs, but could potentially widen regional disparities, which are already relatively high. This will necessitate enhanced transfers and re-centralisation of the financing of spending in some key categories such as education and health. Policies to help catching up of laggard regions by better connectivity through infrastructure investment are bearing fruit, but such investments should be subject to rigorous cost-benefit criteria to enhance capital allocation efficiency and should take into account externalities. Notwithstanding significant disparities along multiple dimensions across provinces, inequalities, be it in terms of income, wealth or education, are actually most striking along the rural-urban dimension. The rural revitalisation strategy, a novel element of the 19th Party Congress outcomes, is expected to address this issue. The other recent strategy of nurturing the formation of city groups will also likely benefit rural areas in-between those cities.This Working Paper relates to the 2019 OECD Economic Survey of China (http://www.oecd.org/economy/china-econo mic-snapshot/). |
| Keywords: | administrative monopolies, competition, fiscal transfers, hukou, inter-governmental fiscal relations, labour mobility, protectionism, regional disparities, regional policies |
| JEL: | R58 L12 L51 L52 P25 J61 H77 |
| Date: | 2019–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:1557-en&r=all |
| By: | Matysiak, George; Olszewski, Krzysztof |
| Abstract: | We employ two methodologies in order to identify groupings of cities and to analyse the factors which drive convergence in residential prices across Polish prime markets over the period 2007-2018. The Phillips and Sul (2007) methodology is used to identify convergence in primary residential prices in the major Polish cities. The results indicate that residential prices do not converge to a single common trend. However, we find the existence of three distinct sub-groups of cities (‘clubs’) where residential prices converge to their own steady-state paths. Using an ordered logit model, we investigate supply and demand factors determining club membership, which subsequently allocates 13 out of the 15 cities as belonging to the clubs identified by the Phillips and Sul procedure. |
| Keywords: | Polish residential prices, Phillips and Sul, panel convergence, relative transition, ordered logit model. |
| JEL: | R1 R15 R3 R31 R32 |
| Date: | 2019–06–23 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94660&r=all |
| By: | Ben Fradj, Nosra; Jayet, Pierre-Alain; Rozakis, Stelios; Georganta, Eleni; Arampatzi, Panagiota; Jedrejek, Ania; Kozak, Malgorzata |
| Abstract: | This paper aims to assess the impacts of 2013 CAP reform in Poland. We provide a comprehensive approach to modelling crop diversification options at farm group level. Belonging to the category of mathematical programming tools, AROPAj model is used to determine the number and mix of crops that may be efficiently cultivated. We consider an energy fast-growing plantation, i.e, willow, to enlarge the potential number of eligible crops. In this respect, we explore the impacts of crop diversification when the number crop limit and the payment benefiting areas planted with willow vary. |
| Keywords: | Agricultural and Food Policy |
| Date: | 2019–05–29 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa172:289820&r=all |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Julia Grübler (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | This publication is available in German language only. For a brief English summary see further below. Die Konjunktur in den mittel-, ost- und südosteuropäischen Ländern (MOSOEL) kühlt sich zwar ab, aber viel weniger als noch im Frühjahr erwartet Die Prognosen für heuer wurden für die Mehrheit der Länder nach oben revidiert. Vor allem in der EU-MOE-Region hat sich das Wachstum vom Abschwung im Euro-Raum recht deutlich abgekoppelt. In einigen Ländern mehren sich sogar die Anzeichen einer Überhitzung, die allerdings nur in Rumänien Anlass zur Sorge gibt. Die Westbalkanländer profitieren von steigenden FDI-Zuflüssen, mehrere GUS-Länder von der expansiven Fiskalpolitik. In Russland dagegen hat der restriktive fiskalpolitische Kurs die Wirtschaft an den Rand einer Rezession gebracht. Die Wirtschaftskrise in der Türkei erwies sich zwar tiefer als früher erwartet, dürfte aber spätestens 2020 überwunden sein. Insbesondere die Visegrád-Staaten gehören zu Österreichs wichtigsten Wirtschaftspartnern. Ihnen waren im Jahr 2018 mehr als 10% des österreichischen Güterhandels, 20% der Einkommen aus Direktinvestitionen sowie 40% der Auslandsforderungen österreichischer Banken zuzurechnen. Gleichzeitig sind sie auch EU-Mitglieder mit brisanten politischen und wirtschaftlichen Herausforderungen, von welchen auch Österreich nicht unberührt bleiben wird. English Summary Eastern Europe standing firm in face of global headwinds The economy in the Central, East and Southeast European countries (CESEE) is cooling down, but much less than expected in the spring the forecasts for this year have been revised upwards for the majority of countries. Particularly in the EU-CEE region, growth has decoupled quite clearly from the downturn in the euro area. In several countries there are even signs of overheating, although only in Romania this is a cause for concern. The Western Balkans are benefiting from rising FDI inflows, while several CIS countries from expansionary fiscal policy. In Russia, on the other hand, the restrictive fiscal policy has brought the economy to the brink of recession. Although the economic crisis in Turkey proved to be deeper than previously expected, it should be overcome by 2020 at the latest. The Visegrád countries, in particular, prove very important for the Austrian economy. In 2018, they accounted for more than 10% of Austrian goods trade, 20% of income generated by Austrian investment abroad, as well as 40% of foreign claims of Austrian banks. At the same time, they are among the EU Member States facing increasing political and economic challenges, by which Austria will not be unaffected. |
| Keywords: | Konjunkturprognose, Mittelosteuropa, Westbalkan, Visegrád, Österreich, EU-Osterweiterung, Außenhandel, Investitionen, FDI, Automatisierung, Arbeitskräftemangel, Migration, economic forecast, Central and Eastern Europe, Western Balkans, Visegrád, Austria, EU Eastern Enlargement, international trade, investment, FDI, automation, labour shortages, migration |
| JEL: | E20 E66 O52 O57 P24 P27 P33 P52 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:wii:ratpap:rpg:14&r=all |
| By: | Kuznetsov, Aleksei (Eurasian Development Bank); Berdigulova, Aigul (Eurasian Development Bank) |
| Abstract: | 2018 saw the highest economic growth rate since 2014. GDP increased by 7.3% after 7.1% in 2017. As a result, the economy continued along its steady growth acceleration path, somewhat above the potential level. Investment and consumer activity was the key factor behind the growth acceleration in 2018. The State infrastructural development programs continue to support investment demand and lay the basis of economic growth. The revival of domestic demand in 2018 was partially the effect of households’ deferred demand as inflation reached a record low. In the 2nd half of 2018, inflation reached the target range of 7% (±2 pp); it was 5.4% at the end of the year. The inflation trends were shaped by the world food market, the base effect in the fruit and vegetables sector, and transport and electricity tariff policy. The current account deficit expanded as the negative goods and services balance widened, partially due to growing imports of machines and equipment for the implementation of large-scale infrastructural projects. The expansion of the State budget deficit in 2018 also resulted from growing public investment. The State budget’s expenditures on the development of energy sector infrastructure grew 2.2 fold compared to 2017. Public debt stabilized in 2018, largely because most of the external funding was raised in the form of grants. In early 2018, the NBT reduced its refinancing rate from 16.0% to 14.0%. However, due to unforeseen external shocks that increased the volatility of EDB member countries’ currencies, inflationary risks increased again, and the monetary authorities suspended their rate reduction round. The banking system is moving in the direction of recovery, but the indicators remain weak. In 2018 the credit portfolio stopped shrinking and increased by 2.0%. In the projection period, the economic growth rate is expected to stabilize near 7%. The investment drive will continue to support the economy. Consumer demand expansion will slow down somewhat as remittance inflow decelerates and the low inflation background’s favorable effect on household income peters out. Inflation will depend on the situation prevailing in the world food markets. World food prices are expected to start recovering in the 1st half of 2019, and by the beginning of 2020 their trend will stabilize, which in turn will impact the trajectory of consumer price growth in the RT. |
| Keywords: | macroeconomy; forecasting; Eurasia; EAEU countries; economic growth; monetary policy |
| JEL: | E17 E52 E66 O11 |
| Date: | 2019–05–21 |
| URL: | http://d.repec.org/n?u=RePEc:ris:eabrwp:2019_005&r=all |
| By: | Klyachko, Tatiana (Клячко, Татьяна) (The Russian Presidential Academy of National Economy and Public Administration); Avraamova, Elena (Авраамова, Елена) (The Russian Presidential Academy of National Economy and Public Administration); Loginov, Dmitriy (Логинов, Дмитрий) (The Russian Presidential Academy of National Economy and Public Administration); Polushkina, Elena (Полушкина, Елена) (The Russian Presidential Academy of National Economy and Public Administration); Semionova, Elena (Семенова, Елена) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | Every year the Center of the Economics for Continuing Education of the Institute of Applied Economic Research of the Russian Presidential Academy of National Economy and Public administration monitors the youth labor market problems. This article uses fieldwork collected in the three regions of the Russian Federation. The results of the monitoring made it possible to identify the main patterns of youth employment in economic context. |
| Keywords: | monitoring, youth employment, economic context |
| JEL: | J62 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:ppaper:061901&r=all |
| By: | Kaltenegger, Oliver |
| Abstract: | This paper presents a novel logarithmic mean Divisia index (LMDI) decomposition framework that is tailor-made for unit cost indicators. It adds four new models to the existing LMDI model family. The main novelty of the new framework lies in the separation of quantity and price effects captured in unit cost indicators, while retaining the same desirable properties of traditional models. Four case studies apply the novel LMDI framework to the total real unit energy costs (total RUEC) indicator. Total RUEC represents the sum of direct energy costs (for energy products) and indirect energy costs (energy costs embedded in intermediate inputs and passed on along global value chains) as a fraction of value added. This yardstick allows for monitoring shifts in the burden of energy costs on industries. The first three case studies, based on the World Input-Output Database, cover the period between 1995 and 2009. For an up-to-date analysis, a fourth case study collects additional data for 2009-2016 from energy and economic statistics' institutions. Globally, up until 2009, rising costs for crude petroleum/natural gas and the rise of China in the global economy were the largest drivers of total RUEC. In general, increases of indirect energy costs were more substantial than were those of direct energy costs. The total RUEC of Chinese car manufacturers increased much more strongly than did that of American car manufacturers. After 2009 (until 2016), prices for crude petroleum/natural gas and value added generation were major decelerating factors of global direct RUEC, while increases in energy consumption had offsetting effects. This paper provides a suitable tool to scientists who want to build on unit cost indicators in their research in general and to all policy-oriented institutions concerned with monitoring and analysing the energy transition in particular. |
| Keywords: | Logarithmic mean Divisia index,Structural decomposition analysis,Total real unit energy costs,Monitoring energy transition,Environmental-economic accounting,Multi-regional input-output analysis |
| JEL: | C43 C67 C82 E01 Q43 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cawmdp:110&r=all |
| By: | Huang, Yiping; Li, Xiang; Wang, Chu |
| Abstract: | This paper uses loan application-level data from a Chinese peer-to-peer lending platform to study the risk-taking channel of monetary policy. By employing a direct ex-ante measure of risk-taking and estimating the simultaneous equations of loan approval and loan amount, we are the first to provide quantitative evidence of the impact of monetary policy on the risk-taking of nonbank financial institution. We find that the search-for-yield is the main workhorse of the risk-taking effect, while we do not observe consistent findings of risk-shifting from the liquidity change. Monetary policy easing is associated with a higher probability of granting loans to risky borrowers and a greater riskiness of credit allocation, but these changes do not necessarily relate to a larger loan amount on average. |
| Keywords: | monetary policy,risk-taking,non-bank financial institution,search-for-yield,risk-shifting |
| JEL: | E52 G23 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwhdps:142019&r=all |
| By: | Eduard Baumohl (Národná banka Slovenska, Bratislava); Ichiro Iwasaki (Institute of Economic Research, Hitotsubashi University, Tokyo, Japan); Evžen Koèenda (Institute of Economic Studies, Charles University, Prague, Czech Republic) |
| Abstract: | We analyze the impact of institutional quality on firm survival in 15 European emerging markets. We employ the Cox proportional hazards model with a large dataset of firms during 2006–2015. Our results show that institutional quality (IQ) is a significant preventive factor for firm survival, and it displays diminishing returns as its effect is largest for low-level IQ countries and smallest for high-level IQ countries. In terms of specific indicators, the level of national governance and the extent of corruption control exhibit the key impacts. In terms of firmspecific controls, indicators of ownership structure and aggregate financial performance are the economically most significant factors associated with increased survival probability of firms in European emerging markets. |
| Keywords: | firm survival, institutions, European emerging markets, survival and exit determinants, hazards model |
| JEL: | C14 D02 D22 G33 |
| URL: | http://d.repec.org/n?u=RePEc:svk:wpaper:1063&r=all |
| By: | Kaukin, Andrey (Каукин, Андрей) (The Russian Presidential Academy of National Economy and Public Administration); Pavlov, Pavel (Павлов, Павел) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | A methodology for assessing the level of market power of metallurgical products producers was deveoped in the paper with the use of aggregated industry-level data. The first chapter of the paper presents an overview of theoretical and empirical approaches to modeling competition and assessing the level of market power in the metallurgical products market. The second chapter presents the characteristics of the Russian ferrous and non-ferrous metals markets. The third chapter describes the characteristics of the database, which was used to estimate the demand-supply system for metallurgical products market. The fourth chapter presents the results of econometric estimates of the level of market power in the market of ferrous and non-ferrous metals (the latter is examined on the example of products of the aluminum industry). |
| Keywords: | ferrous metals, non-ferrous metals, competition models, level of market power, demand function, supply function, arbitrage limits, micro-level data, industry-level data. |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:061914&r=all |
| By: | Rudakov, Victor (HSE); Figueiredo, Hugo (CIPES – Centre for Research in Higher Education Policies); Teixeira, Pedro N. (University of Porto); Roshchin, Sergey |
| Abstract: | This paper analyses the determinants and consequences of horizontal job-education mismatches, an increasingly relevant topic in debates about education and labour markets. This issue reflects the articulation of educational fields and occupations in the labour market. We evaluate the determinants of job-education mismatches and their impact on salaries of university graduates using comprehensive and representative national data for Russia. The study is based in graduates' assessment and statistical analyses. We find that one-third of graduates in Russia work in a job that is not related to their field of study. Moreover, graduates from fields that either generate more general human capital (social sciences, business, law, services) or where low pay is common (agriculture) are more likely to be in that situation. On the contrary, graduates from fields that generate specific human capital (e.g.: medicine) are considerably more likely to be matched. We find that mismatches negatively affect the earnings of university graduates and the higher the degree of mismatch, the higher the penalty for the mismatch. The study depicts that mismatch is penalized in the majority of fields except for low-paid ones (e.g.: agriculture). |
| Keywords: | job-education mismatch, education-occupation mismatch, horizontal mismatch, graduate salaries, labor market outcomes, human capital |
| JEL: | J24 J30 J31 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12407&r=all |
| By: | Cristina Batog; Ernesto Crivelli; Anna Ilyina; Zoltan Jakab; Jaewoo Lee; Anvar Musayev; Iva Petrova; Alasdair Scott; Anna Shabunina; Xin Cindy Xu; Ruifeng Zhang |
| Abstract: | The populations of Central and Eastern European (CESEE) countries—with the exception of Turkey—are expected to decrease significantly over the next 30 years, driven by low or negative net birth rates and outward migration. These changes will have significant implications for growth, living standards and fiscal sustainability. |
| Keywords: | Central and Eastern Europe;Demographic indicators;Emigration and immigration (Economic Aspects);Labor productivity;Labor supply;Demographic changes; Labor supply; Productivity; Potential growth; Convergence |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfdep:19/12&r=all |
| By: | Vedran Recher (The Institute of Economics, Zagreb) |
| Abstract: | In this paper, the relationship between unemployment and crime is analysed. A panel of 20 Croatian counties over the years 1998-2013 is used to estimate the effect of unemployment on the rates of various groups of property and violent crimes. According to the theory of economics of crime, increase in unemployment leads to higher crime rates. A fixed-effects model, including time- and county-specific effects and several covariates, is estimated. The results show there is no impact of unemployment on aggregate property crimes. For all violent crimes bar rapes, the results oppose the theory and intuition. The unexpected results are discussed in the context of the Croatian-specific macro-environment. |
| Keywords: | smuggling, tobacco, logit, Western Balkans |
| JEL: | K42 I18 F19 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:iez:wpaper:1901&r=all |
| By: | Sylvie Démurger; Eric A. Hanushek; Lei Zhang |
| Abstract: | This paper estimates the return to an elite university education over a college graduate’s career using the CHIP 2013 data. We find a substantial premium for graduating from an elite Chinese university at job entry, but it declines quickly with labor market experience. This pattern is entirely driven by the young cohorts who enter college after the higher education expansion that started in 1999. This pattern is more pronounced in coastal provinces and in economically more developed regions, where individual skills are highly rewarded in the labor market. The initial elite premium and its subsequent decline is found just for males; individual skills are much more consistently rewarded for females than males. The results are consistent with employer learning, where employers pay workers based on more easily observable group characteristics at job entry but rely less on these over time when more accurate information about individual productivity becomes available. |
| JEL: | I20 I23 J2 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25955&r=all |