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on Transition Economics |
| By: | Martin Hodula; Simona Malovana; Lukas Pfeifer |
| Abstract: | This paper examines how mortgage lending adjusts when higher interest rates coincide with tighter borrower-based regulatory constraints. Using loan-level data from the Czech Republic for 2020–2023, we exploit a unique policy sequence that combines rapid monetary tightening with the subsequent re-tightening of LTV, DTI, and DSTI limits in order to trace changes in borrower and loan characteristics among new originations. During the initial phase of tightening, higher interest rates curtailed mortgage lending, yet some adjustment was still possible: new loans started to feature higher downpayments and longer maturities, which partly absorbed the rise in financing costs. As tightening persisted and borrower-based limits were reinstated, these adjustment margins narrowed. Liquidity buffers were depleted, and new lending increasingly reflected financially stronger borrowers with lower leverage and lower default risk. The evidence further shows that while monetary policy primarily reduced lending volumes, it was the re-application of borrower-based limits that improved the risk composition of new loans. |
| Keywords: | Borrower-based limits, household finance, loan-level data, macroprudential policy, monetary policy |
| JEL: | E58 G21 G28 G51 |
| URL: | https://d.repec.org/n?u=RePEc:cnb:wpaper:2026/02 |
| By: | Oxana Babecka Kucharcukova; Jan Bruha; Petr Sterba |
| Abstract: | This paper introduces a novel travel performance indicator derived from tourist reviews available online, utilizing text mining techniques. The time series generated is integrated as an explanatory variable into a small-scale empirical model of travel revenue and expenditure in the Czech Republic's balance of payments. The signiï¬ cance of online reviews for nowcasting is validated through various machine learning algorithms. The study also addresses empirical challenges, including trends in review data, the impact of the COVID-19 pandemic, and occasional methodological changes in ofï¬ cial statistical series, and outlines strategies to overcome these obstacles. The ï¬ ndings suggest that the proposed model is a valuable addition to the Czech National Bank's nowcasting framework. To the best of our knowledge, this is the ï¬ rst study to combine text analysis with nowcasting of a BoP item, speciï¬ cally travel services. |
| Keywords: | Balance of payments, text mining, travel services |
| JEL: | C53 C83 F17 |
| Date: | 2025–11 |
| URL: | https://d.repec.org/n?u=RePEc:cnb:wpaper:2025/13 |
| By: | Arpino, Bruno; Tosi, Marco; Bordone, Valeria |
| Abstract: | Objectives. We aim to provide updated, comparative evidence on the prevalence of frequent contact (including digital) and close proximity between older parents and their children, and to assess how measurement choices affect cross-national patterns in Europe. Methods. We use data on 23 European countries from the Survey of Health, Ageing and Retirement in Europe wave 9 (2021–2022) and the European Social Survey round 10 (2020–2022) to estimate the prevalence of frequent contact and close proximity across different approaches: most-contacted versus random child, any versus mode-specific contact, distance versus travel-time thresholds. Cross-national coherence is assessed with Spearman rank correlations and Kendall’s W. Results. We find a pronounced regional gradient: Southern Europe shows the highest levels of frequent contact and close proximity, Nordic and Continental countries the lowest, and Eastern Europe are in-between with internal heterogeneity. Digital communication is part of the intergenerational repertoire, albeit not clearly geographically patterned. Face-to-face and phone contacts remain dominant; texting is less widespread, while video calls remain rare. Measurement choices substantially shift prevalence levels but much less the ranking of countries that remains consistent also when adjusting for socio-demographics. Discussion. We document persistent family-regime differences and highlight digital contact as a supplementary facet of associational solidarity. Results point to risks of a double exclusion for older adults who lack face-to-face contact and cannot exploit digital tools and underscore that survey design choices matter for levels but not ranking-based comparisons, supporting the use of random-child items in general surveys. |
| Date: | 2026–01–13 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:uqept_v1 |
| By: | Harry Aytug |
| Abstract: | Two decades of research on the euro's trade effects have produced estimates ranging from 4% to 30%, with no consensus on the magnitude. We find evidence that this divergence may reflect genuine heterogeneity in the euro's trade effect across country pairs rather than methodological differences alone. Using Eurostat data on 15 EU countries from 1995-2015, we estimate that euro adoption increased bilateral trade by 24% on average (15.0% after fixed effects correction), but effects range from -12% to +68% across eurozone pairs. Core eurozone pairs (e.g., Germany-France, Germany-Netherlands) show large gains, while peripheral pairs involving Finland, Greece, and Portugal saw smaller or negative effects, with some negative estimates statistically significant and interpretable as trade diversion. Pre-euro trade intensity and GDP explain over 90% of this variation. Extending to EU28, we find evidence that crisis-era adopters (Slovakia, Estonia, Latvia) pull down naive estimates to 5%, but accounting for fixed effects recovers estimates of 14.0%, consistent with the EU15 fixed-effects baseline of 15.0%. Illustrative counterfactual analysis suggests non-eurozone members would have experienced varied effects: UK (+24%), Sweden (+20%), Denmark (+19%). The wide range of prior estimates appears to be largely a feature of the data, not a bug in the methods. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.19664 |
| By: | Bachev, Hrabrin |
| Abstract: | There has been a fundamental modernization of the wastewater management system in Bulgaria during the EU pre-accession and membership periods. The transition toward sustainable management of wastewaters has been associated with the modern disposal of generated sludge from wastewater treatment plants and the increasing agricultural utilization of this material. The agricultural utilization wastewater management chain emerged and gradually extended as the amount of produced sludge increased and its share was effectively utilized in agriculture. This paper analyses the evolution and challenges of agricultural inclusion in sustainable wastewater management in Bulgaria. It is based on the incorporation of the interdisciplinary New Institutional Economics methodology, official data, and numerous in-depth interviews with representatives of the wastewater treatment plants, responsible authorities, farmers participating and not involved in sludge utilization, and other related agents. The study has found that there has been a significant modernization of the formal institutional environment (rules, regulations, standards, agencies) and incentive structure for agricultural sludge production, transportation, and utilization in recent years. Nevertheless, the potential for inclusion of agriculture in water treatment plants’ sludge utilization has not been entirely used, and the policy target in the area has not been effectively reached. The main impediments for the later arethe significant transition and compliance costs for related agents, inadequate public information, training, and support, environmental and health risks, opposition of landowners, businesses, eco-groups and residents, and uncertain directions of policy development. In the future following actions are needed to promote agricultural use of sludge: clearer policies for wastewaters management, waste disposals and agricultural sludge utilization, including development of a national strategy for sludge management; better enforcement of formal regulations and quality standards in agricultural utilization wastewaters management chain; introducing measures to reduce institutionally determined (production and transaction) costs for agents; support specialized training, information and independents assessment on agricultural sludge utilization; use CAP and other EU instruments to support agents’ efforts to adapt to formal requirements and extend sustainable treatment, disposal, transportation, agricultural utilization and commercialization of sludge. |
| Keywords: | wastewaters, sludge, management, agricultural utilisation, Bulgaria |
| JEL: | Q10 Q12 Q13 Q15 Q16 Q18 Q5 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127457 |
| By: | Marek Folprecht |
| Abstract: | The study presents a holistic approach to modeling flood risk of real estate properties. The method combines the hydrological flow simulation model and a model of financial losses. Two use cases of the model are discussed. First, a stress testing method, based on historical scenario simulations, is presented. Next, a Value at Risk approach using the Generalized extreme value distribution and the Gumbel copula is discussed. Both methods are then tested on a large sample of Czech house data. The results show that the model can replicate the order of historical flood magnitudes under the historical scenarios. Moreover, the Value at Risk approach can generate scenarios unseen in recent history. The model could be a useful flood losses modeling tool for banks, insurance companies, real estate investment companies or state agencies. A special case for stressing credit risk parameters for mortgage portfolios is discussed in more detail. |
| Keywords: | Flood risk, Generalized extreme value, Gumbel copula, Value at Risk, Monte Carlo, Czech Republic, Stress Testing |
| Date: | 2025–12–14 |
| URL: | https://d.repec.org/n?u=RePEc:prg:jnlwps:v:6:y:2026:id:6.001 |
| By: | Carlos Cañizares Martínez (BANQUE CENTRALE DU LUXEMBOURG); Adriana Lojschová (NATIONAL BANK OF SLOVAKIA); Alicia Aguilar (BANCO DE ESPAÑA) |
| Abstract: | This paper estimates the effects of standard monetary policy shocks on housing and other macro variables in Slovakia, a CESEE country. For that purpose, we use a non-linear local projection model which uncovers asymmetries in these effects around three different dimensions: high versus low economic growth, interest rates and inflation. The main findings in this study are as follows. First, we often find no evidence of standard monetary policy eliciting a contractionary response in house prices or housing investment. Second, evidence is weakest during recessions and periods of low interest rates or low inflation. Third, these findings may be linked to the inability of monetary policy to trigger significant contractionary effects on household lending, which in turn may be linked to the effective lower bound on interest rates, the predominance of fixed-rate mortgages in Slovakia or interaction between monetary and macroprudential policy. We also discuss the possible country characteristics that might drive these results and policy implications. |
| Keywords: | monetary policy, non-linearities, local projections, euro area |
| JEL: | C32 C36 E42 E52 E58 R21 R31 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:bde:wpaper:2602 |
| By: | Huynh, Cong Minh |
| Abstract: | This paper examines whether and how local governance quality shapes household economic resilience to climate shocks in Vietnam - one of the world’s most climate-vulnerable emerging economies. Combining nationally representative microdata from three rounds of the Vietnam Household Living Standards Survey (2018, 2020, 2022) with province-year indicators of disaster severity and governance performance (PAPI), we estimate a pooled ordinary least squares (OLS) and interaction model with two-way fixed effects at the province and year levels to identify the moderating role of governance in the climate shock–income relationship. The results show that climate shocks significantly reduce household per-capita income, but higher-quality provincial governance substantially attenuates these losses. Marginal effects indicate that in high-governance provinces, the income-dampening effect of shocks becomes negligible. Moreover, governance benefits are markedly larger for vulnerable groups, including poor, rural, and agricultural households, suggesting that institutional quality can be inherently pro-poor in climate-stressed contexts. These findings advance the resilience and governance literature by providing micro-level causal evidence from a developing country and highlight governance strengthening as a core policy lever for climate adaptation, equitable development, and inclusive growth. |
| Keywords: | Climate shocks; Governance quality; Household economic resilience; Vietnam |
| JEL: | O17 O18 O43 Q54 |
| Date: | 2025–12–12 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127322 |
| By: | Martin Hodula; Simona Malovana |
| Abstract: | Do domestic or foreign interest rates matter more for investor behavior in a small open economy? This paper examines how domestic investors adjust mutual fund allocations in response to monetary policy shocks, using granular Czech mutual fund data from 2009 to 2023. Employing a local projection framework with an instrumental variables strategy, we show that fund flows react strongly to exogenous changes in interest rate differentials. Foreign monetary policy shocks are found to have a more pronounced effect than domestic ones. These responses occur almost exclusively through adjustments in inflows, with outflows remaining largely stable, indicating that monetary policy influences new allocations rather than causing redemptions. Exchange rate movements, economic sentiment, and fund liquidity further modulate these effects, making them stronger when the currency depreciates, sentiment is negative, or funds are less liquid. |
| Keywords: | Domestic investors, foreign monetary policy, interest rate differentials, liquidity, mutual fund flows, small open economy |
| JEL: | E44 E52 F32 G11 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:cnb:wpaper:2025/11 |
| By: | Minhaj Mahmud (Asian Development Bank); Yujie Zhang (University of Pennsylvania) |
| Abstract: | This study examines the interplay between extreme temperatures and air pollution risks, the geographic and temporal distribution, as well as the population burden of climate shocks in Bangladesh, Indonesia, Pakistan, Thailand, and Viet Nam—countries severely impacted by climate change. Using ERA5-HEAT temperature data and PM2.5 pollution data, we first identify “hotspots” within and across the countries by analyzing district level trends in heat stress and pollution exposure. We further explore the correlation between temperature and pollution shocks. Finally, jointly considering the spatial distribution of populations and key climate and pollution hazards, we highlight the most vulnerable groups with population weighted exposure measures. Our findings reveal distinct country-specific patterns in both the correlation between heat stress and air pollution risk, and the population exposure to the hazards across demographic profiles. These results emphasize targeted policies to mitigate the compounded effects of climate and air pollution hazards on vulnerable populations across Asia. |
| Keywords: | heat;air pollution;climate change;Asia;population exposure |
| JEL: | J10 Q53 Q54 Q56 |
| Date: | 2026–01–27 |
| URL: | https://d.repec.org/n?u=RePEc:ris:adbewp:022144 |
| By: | Nenovsky, Nikolay; Marinova, Tsvetelina |
| Abstract: | Between 1958 and 1971 (until the adoption of the Comecon's Comprehensive Programme), active work was carried out on models for complete separation from world (capitalist) market prices. Bulgarian economists were particularly active in this regard, and their position was also expressed politically, which gives us reason to examine their proposals in particular. To this end, the present text sequentially examines several debated methodological issues related to pricing (within the framework of the Marxian labour theory of value, particularly in the work of Jacques Aroyo), selected ideas of Bulgarian economists on practical pricing (again Jacques Aroyo and Evgeni Mateev), the Tsvetkov–Golubarev approach, as well as Stefan Stoilov’s analyses of the potential effects of a transition to an independent pricing basis. |
| Keywords: | Socialist integration, international prices, prices formation, Comecon, Bulgarian economists |
| JEL: | B22 B24 F50 N14 P33 |
| Date: | 2026–01–09 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127666 |