The aim of this paper is to analyze how employees may affect firm's corporate governance. In particular, we analyze a shareholder-manager relationship through a principal-agent framework. The manager is the agent in charge of taking decisions for firm's success. Yet, when deciding, the manager takes into account employees' preferences, i.e. the manager wants to enjoy a "quiet life". Our result highlight that having a quiet-life manager is not necessarily linked to destroy value, as suggested in recent research. It might even recover part of the efficient decisions (at a cost borne by the shareholder).
Project evaluation is the control of the planning and implementation of project activities with regard to the objectives to be achieved. In this paper we assume the objective to be efficient outcome and profit maximization. This means that project evaluation puts normative assessments into the context of planning and management and hence into the context of intentional action and cycles of action. The model for project evaluation we propose has two money holders who must decide how to invest their money in two investment funds (financial intermediaries) that, in turn, will use the money to bid to acquire ownership in two projects. The general case when the number of money holders, the number of funds, and the number of investments are arbitrary may be handled in a similar manner to the development below, but at a cost of greater complexity. As a result no mechanism to achieve the maximum outcome is present and different methods to find optimal structure under uncertainty and different cost structures are discussed.
Applying the EGARCH model, this paper finds that Lithuania's stock market index is positively impacted by real GDP, the M2/GDP ratio, and the stock market indexes in the U.S. and Germany and negatively affected by the ratio of the government deficit to GDP, the LTL/USD exchange rate or depreciation of the litas, the domestic real interest rate, the expected inflation rate, and the euro area government bond yield. Hence, a declining government deficit/GDP ratio, a lower interest rate or more money supply relative to GDP, the appreciation of the litas, a lower foreign interest rate, or a robust world stock market would help the stock market in Lithuania .
The paper presents the results of two different studies focused on the problem of corporate compliance with International Accounting Standards, searching for the factors influencing the International Accounting Standards Implementation. The problem of IASs implementation is the most important topic of the contemporary theory of international accounting due to globalization processes and pressures for achieving the accounting harmonization. There are many differences among institutional and other environmental factors presenting the barrier to reaching the harmonization goals, but there are also different enterprise's own internal factors influencing the extent of compliance with a given set of international standards. This paper has identified some of the factors as the result of two separately performed researches that could be of some help to understanding of significant differences in IASs implementation among the enterprises, as well as over the countries.
In recent years, the accounting in Europe has mainly developed within two schools of accounting: the Central European or German school of accounting and the Anglo-Saxon or English one. Fundamental differences between the two are evident not only in the accounting area; they derive from different ways of thinking and views regarding some vital issues of life and economy, and particularly regarding the role of government and legislation in taking important economic decisions and adopting other solutions. One of the basic assumptions in accounting is the assumption of prudence, which also determines and influences, directly or indirectly, other accounting assumptions, principles and rules in preparation of financial statements. It is therefore extremely important to know what its theoretical concept is and how it is treated. The article gives the theoretical foundation of the principle of prudence and explains its importance and impact on financial statements.
This study is focused on the linkages between the legislative families as descriptors of national legislative systems and International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB). We consider such analysis as a case study for the more general issue of explaining the preferences of national regulators in the adoption of foreign norms, rules, standards and practices. By using a dataset of 162 jurisdictions and dummy variables designed to capture the current stage of IFRSs adoption and, respectively, the taxonomy of their legislative systems, we find that a full IFRSs adoption is more likely to occur in countries which have principles-based on legislative mono-systems. In addition, we observe that a strong rule of law, with an effective mechanism of property rights reinforcement, as well as the pre-adoption existence of a pro-growth set of public policies can contribute to the encouragement of IFRSs adoption.
This paper examines the structure of agri-food trade with the emphasis on commerce of Slovenia and Croatia and provides some comparisons with the exchange with selected European trading partners. The focus is mainly on the period immediately before and after the EU enlargement and thus captures the so far existing effect of changing trading regime. The decline in price and quality competitiveness of Slovene agri-food products in Croatian market is observed, which is reflected also in the worsening of trade balance in year 2005 compared to 2003. As for the prevailing trade types, for Croatia the prevalence of intra-industry trade is observed, while the trade with European trading partners is determined by inter-industry trade.
Achieve high rates of economic growth is the government’s task of any country because the future world order depends on the own ability to improve the living standards of its citizens. In Croatia, observed at the regional level, is present uneven economic growth according to the GDP per capita, while in line with the nominal growth rate economic development shows uniform movements. In recent years, Croatia has obtained a relatively high growth rates, but they were still below the average rate of other developing countries. Croatia did not follow the global development trends, and the reason for this lies primarily in the uneven economic growth by counties. Using data envelopment analysis, in this paper we determine efficient and inefficient counties, and which resources should be efficiently used to enhance regional production, and then also the total national production.4
An annuity is a payment for the use of a fixed resource, such as land, natural resources or in our case a cultural monument. The theory of annuities has been developed by numerous economic theorists, primarily examining land annuities, amongst them W. Petty, A. Smith, D. Ricardo, T. R. Malthus, K. Marx, P. A. Samuelson and others. Monument annuity, therefore, represents an irreplaceable economic instrument through which the economic value of the monument is asserted on the market. Through its functions the annuity enables the management of protected built heritage as well as the realization of the most important objective of protection, and that is not only the preservation of the monument value of built heritage but also the "wise use" of built heritage in economic development.
While communication exists in all cultures and subcultures, communication norms and exceptions may be vastly diverse due to the differences in culture. Communication is an ongoing process that involves constant changes within the people involved and their environment. The focus of this paper is on intercultural communication apprehension as a construct and on how it affects the behavior and lifestyle of an individual. The research was carried out on freshmen students at the Department of Economics and Tourism. They were interviewed twice, first at the beginning of the semester and second at the end of the semester, during which they communicated with students from varies cultures, who studied at our Department. The fact that foreign students joined the class for the whole semester as well as the gained knowledge referring to the exposure with foreign people or different cultures probably both contributed to the positive results
The primary purpose of this study is to model and analyze inflation volatility in ten selected Asian economies. We used quarterly data of inflation from 1987Q1 to 2008Q4 to model inflation volatility as time varying process through different symmetric and asymmetric GARCH specifications. We also proposed to model inflation volatility on the basis of cyclic component of inflation obtained from HP filter, instead of actual inflation when the latter does not fulfill the criterion of stationarity. Through news impact curves we tried to highlight the behavior of inflation volatility in response to lagged inflation shocks, under different GARCH specifications for selected economies. Bivariate granger causality test is also applied to analyze the direction of causality between inflation and different volatility estimates.
We get few important results. At first, leverage parameter shows expected sign and is significant for almost all countries suggesting strong asymmetry in inflation volatility. The hyperbolic sign integral shape of news impact curves based on GJR-GARCH is not only consistent with the results of our previous study based on Pakistani data (Rizvi and Naqvi, 2008) but also highlight the importance of inflation stabilization programs particularly because of the subsequent evidences obtained in favor of bidirectional causality running between inflation and inflation volatility. We also found that cyclic component of inflation could be a suitable proxy of inflation for volatility estimation.
At the end of the 80s of the last century, the world economic scenery went through significant changes, among which we mainly think of a shortage of revolutionary discoveries, which would increase demand and establish new big markets. Countries are faced to provide organized support for the establishment and development of SMEs which will be privately owned. It would obviously increase the country's opportunities to provide for its needs from the real sources (through tax collection). Mutual interests would empower connections among the countries and among the private entrepreneurs, which, in the end, would have a positive impact on generating the economic growth and on the total development of the national economy, i.e. the economy of the region. Through this work the authors are trying to indicate the possibilities and ways of economic development in Bosnia and Herzegovina and Croatia, recalling the experience of other countries in which economic growth, and therefore the total social development, are mainly the results of the entrepreneurial culture
The system of indicative macroeconomic planning requires preparation and application of an adequate institutional, analytical, methodological and modelling framework in the Republic of Macedonia. The institutional framework of the system of indicative macroeconomic planning is identified through: State Statistical Office of the Republic of Macedonia, the Agency for macroeconomic models, analyses and studies (non-existent at the moment) and the Ministry of Finance (Macroeconomic Department). The most adequate analytical framework for macroeconomic analysis and planning is the elaboration, preparation and implementation of an input-output table, a social accounting matrix (SAM) and a macroeconomic CGE human sustainable development model.
This paper is the result of empirical research among the 180 biggest Croatian companies measured in terms of total revenues. The survey was addressed to the managers of internal auditing departments but also the managers who supervise the business activities within the company. The empirical research was conducted from February till March 2007. In that period 43 companies answered to the survey which makes the rate of return of 24%. The aim of this empirical research was to investigate the current position and the presence of internal auditing in Croatian companies, to investigate the instruments of measurement, the business quality among the internal auditors in Croatia and to investigate the contribution that internal auditors make in improving the business quality among the most successful companies in Croatia.
This article analyzes the system of public financing in Bosnia and Herzegovina (hereinafter BH), whose unfavourable structure is caused by the complex state organization and its asymmetrical fiscal and financial structure that causes enormous public expenditure. The limitation for an effective development of public financing system in BH is a deficient fiscal capacity in collecting the state’s own revenues. Fiscal decentralization in BH is a very complex issue and would demand an appropriate reorganization of the fiscal system in the near future. Reducing and equalizing tax rates, steering public expenditure to development and solving problems of public debt represent urgent steps in the following period as a predisposition for increasing economic activity in the country as a whole. Fiscal policy designed in such a manner would then be capable of stimulating investment consumption as well as reducing shadow economy and tax evasion in BH economy. A lack of political willingness and a weak role of state institutions complicate the development of a fiscal frame that could ensure sustainable financing of the public sector in a long term period and could be capable of faster economic growth and development in order to complete European Union accession process successfully.
The structural model of the effects of marketing mix elements on brand equity is defined in line with the existing theoretical findings. Research hypotheses are defined according to the identified structural model. In order to test the defined structural model and research hypotheses empirical research was conducted on the sample of undergraduate students of the Faculty of Economics and Business in Zagreb. Research results indicate that the structural model has an acceptable level of fit to the empirical data. The estimated structural coefficients and indirect effect coefficients indicate the direction and intensity of effects of each analysed element of marketing mix on brand equity. Finally, implications of research results for the theory and practice of brand management are analysed and discussed.
The paper analyses the concept of country branding. The focus is placed on influential stakeholders who should participate in brand development and implementation. Specifically, the extremely important role of local inhabitants is stressed. The paper focuses on the country branding in Slovenia and investigates the residents' first response to the new brand I feel Slovenia, which was implemented in 2007. The research was conducted half a year after the new brand was born. The results imply that the brand has great potential to become successful, since it is generally well recognised and perceived by its largest internal stakeholder group – local inhabitants.
This paper explores the demand-side perspective on tourism destination phenomenon and investigates whether more comprehensive measure for its evaluation could be applied to the destination brand. Unlike many previous studies dealing mostly with a tourism destination image concept, the approach employed in this paper proposes a more comprehensive measure of destination image and includes the dimensions of tourism destination awareness, quality, and loyalty. The theoretically proposed model was empirically verified for two competitive European tourism destinations (Slovenia and Austria) from the perspective of two culturally heterogeneous tourist markets (Germans and Croatians). The results imply that the traditionally investigated image concept represents the most important dimension in a destination’s evaluation. However, for a more comprehensive evaluation the dimensions of tourism destination awareness, quality and loyalty should be added. Drawing on the results, the paper also offers some implications for tourism organizations in developing and implementing destination marketing strategies in foreign markets.
In the first place this paper considers the monetary politics of Eurosystem. Secondly, the monetary politics strategy of the European Central Bank (ECB) is analysed, emphasizing the target of price stability and that this has been achieved in the European Union. As a result it is concluded that the European Monetary Union is not an Optimum Currency Area. The Union’s labour market is not an integrated and co-operative one. There exist, in fact, deep rooted differences between the labour markets of the countries in the Union, which do not permit work mobility or wage flexibility. There is another factor supporting this thesis, which is the impossibility of turning to tax transfers to contrast unemployment due to the drop in demand. Therefore, it is necessary to reduce the discretion left to the member States in terms of fiscal policy, but it is important, above all, that the countries in the Union respect the rules set up by the Stability and Growth Pact.
The company's business intelligence (BI) environment today is a "patchwork" of technology that has accumulated for a variety of reasons over a long period: many kinds of general-purpose database (DBMS) software, a collection of different servers and end-user application relying on different database and communication standards. Users have approach to content and applications they need through role-based workspace created in BI portal. According to Eckerson& Howson, 2005, they find queries, reporting and analytical tools too complex or time-consuming to use. They spend too much time looking for the right report among hundreds, or get lost in endless series of drill-downs and dimension lists. They think that rather than empower users, BI portals overwhelm them. Concept maps as knowledge visualization tools enable users to create one's own tailored individual workspace and provide the developers with useful information about the learning routes and performance of the knowledge workers. We investigate possibilities of applying concept mapping as a new approach to BI portal development.
The current market situation demands from companies to use complex software systems as a business foundation and connection with customers and partners. Such systems must use complex technologies and efficiently support actual business processes. Traditional development and implementation practices are no longer feasible since customer expectations can no longer be fulfilled without their participation. Development projects must continuously learn and improve their competences towards achieving a common goal: software implementation according to the actual customer expectations. This paper explores new economy software development practices and proposes methods to involve actual customers in software development to enable efficient software implementation, which will provide new business opportunities for the company. The proposed methods are applied on the actual development project to evaluate all benefits of the proposed approach.
The hypotheses of tax-and-spend, spend-and-tax, and fiscal synchronization were tested using annual time series data for Jordan over the period 1969-2002. We include GDP as a control variable into the model. The results from Granger causality test and impulse response function and variance decomposition analysis based on the corresponding multivariate error-correction models suggest feedback effect between government revenues and government expenditures, supporting the fiscal synchronization hypothesis for Jordan.
The purpose and main objective of this study is to find out whether the individuals' susceptibility to reference group influence could serve as the basis for market segmentation. Empirical research was carried out on the sample of 250 respondents in the Split-Dalmatian County. To identify segments, cluster analysis was used. Three customers’ segments were identified and named: “independent”, “neutral” and “dependent – directed by others”. For a better description of individual segments the socio-demographic variables as well as social comparison and personality variables are also included in the analysis. The research results indicate that consumers belonging to the particular segments require separate advertising strategies. For that purpose, some suggestions for each segment are proposed.
In the present study we develop a new two-dimensional Copula-GARCH model. This type of twodimensional process is characterized by a dependency structure modeled using a copula function. For the marginal densities we employ a GARCH(1,1) model with innovations drawn from a t- Student distribution. The model can be easily extended by using more sophisticated processes for the marginal densities. The static specification of the model assumes that the dependency structure of the two data series does not vary in time implying that the parameters of the copula function are constant. On the other hand, the dynamic specification models explicitly the dynamics of these parameters. We econometrically estimate the parameters of the two specifications using various copula functions, focusing on the mixture between the Gumbel and Clayton copulas. We employ daily index returns from two emerging and two developed financial markets. The main finding is that including a varying dependency structure improves the goodness-of-fit of the Copula-GARCH model.
The successful organization is the one that is able to improve quality, lower costs and increase efficiency of operations, and eliminate different activities and products that incur losses. To achieve this, organizations implement different costing systems. A costing system is a system that helps the management of an organisation with planning and decision making. This system plays an important role in providing accurate cost information about the products and services provided for clients. Many organizations shift their focus from conventional or traditional costing systems to an increasingly popular costing methodology system that is Activity Based Costing system. This article specifies characteristics and reasons for implementation of this method, and defines establishment of this method in Serbia.
The aim of this paper is modelling short-term volatility at the main Croatian stock market, Zagreb Stock Exchange. We present GARCH models following the hypotheses that volatility in the short-run depends on the volume of traded stocks and that volatility of the Zagreb Stock Exchange (ZSE) main index CROBEX is influenced by the situation on the international financial markets; NYSE Stock Exchange indices and European Stock indices. We have assessed an influence of the American DJIA and NASDAQ, as well as European DAX and FTSE indices on CROBEX. On the bases of the parameter estimates of the proposed GARCH type models, the objective is to investigate which market – American or European – has a stronger impact on CROBEX index.
Foreign direct investments, according to the home countries as well as economic activities, have been analyzed in the 1993-2008 period. Special emphasis is put on the regional (NUTS 2) and county level analysis, based on the data for the 1997-2007. The FDI determinants on the county level have been analyzed for the first time in Croatia, and the results have confirmed that the share of the highly-educated, export orientation as well as higher share of domestic investment in the county represent positive characteristics for foreign investors, when choosing a location for investment within Croatia.
The purpose of this study is to show the possibility of transition to a single board system at the merger of joint stock companies. The study aims at analyzing the business situation of merging Puljanka d.d. (Puljanka Joint Stock Company), Brionka d.d. (Brionka Joint Stock Company) and Istra d.d. (Istra Joint Stock Company) as well as the organization of the new company according to single board system. The indirect aim is the contribution to the development of economic practice in the Republic of Croatia as well as further scientific research in this field. This research is built upon the assumptions that the Management and Supervisory Boards find it justified for the merger of public joint stock companies to take place as well as that the Management and Supervisory Boards consider it appropriate for the new common company to be organized according to a single board system. The merger and the single board system implementation are based on theoretical assumptions, legislative regulations of the Republic of Croatia as well as the global business practice so far.
In spite of the on-going harmonization process, there are still some differences between US GAAP and IFRS. Currently, companies listed on the New York Stock Exchange, which are reporting according to IFRS, must still prepare the reconciliation to US GAAP, to show the financial statements compliant with US GAAP as well. This article presents an overview of the remaining major differences between US GAAP and IFRS, descriptive as well as table-wise. First, the standards compared are shortly introduced. This is followed by a presentation of details in the separate balance sheet categories, from property, plant and equipment, intangible assets, financial assets and liabilities, investment property, inventory, equity, debt, long-term provisions, employee benefits, deferred taxes and revenue recognition. For conclusion, a matrix of differences in the stated categories is prepared, enabling an easy reconciliation for financial statement users and preparers.
This paper discusses the theoretical aspect of the phenomenon of lag in the application of the measures of monetary policy. Monetary and fiscal policy faces the phenomenon of lag. One of the controversial and pressing questions of monetary policy is the nature and length of lag between the application of the measures of monetary policy and the effects on macroeconomic aggregates. While the monetary strategy points to several possible reasons for the lag, there is no general agreement on the length of the lag. The study of the phenomenon of lag imposes two questions: what does the lag of the application of monetary processes and policy imply and why are the asset holders not capable of immediately adjusting their portfolios at the time of disbalance? There are two categories of lag known in economic literature: the inside lag (which encompasses the recognition of the problem and the implementation of measures) and the outside lag (which encompasses the reaction of macroeconomic aggregates to the applied measures of monetary policy). The paper descriptively notes the different identifications of time lag and provides schematic representations of the effects of the observed phenomenon.
The goal of this work is to establish the structural rules of planning for quality of life of inhabitants. The aim of the research is to establish a division between land plots and the associated structure of general terms into a hierarchy of four levels of units of use and a matrix of symbols for their classification. The research methodology includes an analysis of relevant literature on the characteristics of fractals and the author’s experience in preparing, developing and implementing spatial planning plans. A structure of general terms and symbols for spatial planning has been established with four levels along with the application of hierarchy of use for three groups of land plots and their classification. In this way the hierarchy of land plots is equally relevant for administrators and professionals and is a rule which must be respected.
The paper deals with the issues of data gathering, surveillance and intense use of targeted messages in contemporary living space shaped by technology and by the capitalist view of the world. Those who possess a relevant knowledge about others, possess a power over them, and they can use and abuse this power in various ways. Intense data gathering, observations and surveillance facilitate the manipulation of people and allow the real holders of power to shape the social reality in the ways that serve their interests, but which can easily lead to a totalitarian society. Totalitarian systems used to be imposed by states and by religious organizations, and they were based on political ideologies or religious dogmas. Using the power of technology, contemporary capitalism has been creating a new business civilization which nominally promotes openness and freedom, but which shows clear totalitarian tendencies. The paper puts forward a series of critical reflections related to these issues
Considering the present state of the art among the production optimization frameworks, the Overall Equipment Efficiency methodology is the most popular one. However, this methodology approaches production optimization only from the technology point of view and ignore the economic perspective of optimization. This is why we developed a new key performance indicator Overall Cost Efficiency aimed at measuring the cost efficiency of a production process in real time. Its application is based on the Overall Equipment Efficiency measurements and is convenient for application in industrial management praxis. We have used an ordinary mathematical modeling approach combined with descriptive microeconomic analysis techniques.
In the empirical literature there is a prevalent view that real exchange rates tend to converge towards levels predicted by the Purchasing Power Parity (PPP) only in the long-run and that short-run deviations from the PPP relationship are frequently sizable. The progressing of European monetary integration and the forming of monetary union spurred the interest of researchers to assess the relevance of the PPP theory in the case of the single European currency. Our paper therefore examines this exchange rate theory by testing a dataset of monthly real exchange rates for a sample of 11 eurozone members with respect to different benchmark currencies. Because of the documented drawbacks of linear specifications in examining this exchange rate theory, we utilise a nonlinear unit root test based on the ESTAR model proposed by Kapetanios, Shin, and Snell (2003). The results of unit root tests for the US dollar-based real exchange rate series as well as for Japanese yen-based series suggest that the PPP proposition does not hold in the case of eurozone countries. The absence of real exchange rates’ nonlinear reversion reported in this study thus confirms the thesis of Wu and Lin (2011) regarding the PPP relationship since the inception of the euro.
Acknowledging the importance of the bioeconomy as an important dimension of sustainable economic development, and particularly for E.U. strategies, this paper aims to identify and assess several bioeconomy modellers under the compelling effects of education and research–development–innovation activities. Within this frame of reference, the authors have assessed the role of intellectual capital in shaping bioeconomy outcomes, distinct for the new E.U.-13 and E.U.-15. A complex set of methods and macro-econometric models was applied on two balanced panels, compiled during 1995–2016, that bind random effects models with panel-corrected standard errors, spatial analysis and structural equation modelling. Overall, the importance of research, development, innovation and specific skills acquired in the field of bioeconomy is outlined, as key elements of E.U. economic strategies, being essential for all Member States.
This work suggests the existence of a number of advantages for companies that have opted for the application of International Accounting Standards. Their application allows fair reporting, which is extremely important for countries in transition, as well as for those countries that have not applied IAS. The authors carried a study related to full application of IAS 16 to 114 companies, of which 10 are public and 104 other companies are from the wider area of Novi Sad, in the period 2010–2015. In addition, the study of the case of public companies is done in order to demonstrate the situation before and after the valuation of assets and equipment as at 30 June 2012. The state after 3 years is fairly shown on 30 June 2015, all in order to make valid conclusions regarding fair reporting of the public enterprises. It can be concluded that the application of IAS 16 has multiple benefits by companies that fully apply fair reporting in its operations.
This study aims to determine the impact of investment behavior on financial markets during COVID-19 with respect to the UK. This study is quantitative, where the data has been gathered from the primary sources of information, i.e., through a survey questionnaire. The researcher adopted the non-probability convenience sampling through which 337 responses were gathered. The questionnaire was self-administered, which was based on 7 points Likert scale. Concerning the analysis, the SEM technique has been adopted in which CFA and path analysis were carried out to determine the impact of variables. The study’s analysis determined significant moderation of COVID-19 uncertainty over the relationship of risk perception and general risk to tolerance. Similarly, the moderation of COVID-19 uncertainty over the relationship of risk perception and financial risk to tolerance was also determined. Additionally, the profitability rate’s effect was determined by the financial risk tolerance and general risk tolerance. Moreover, the effect of risk perception was also determined over the financial risk to tolerance. Lastly, the effect of satisfaction was determined to be significant over the general risk to tolerance.
The novel Covid-19 outbreak has adversely affected every sector of the economy, including the tourism and hospitality sectors. Holding the importance as one of the leading contributors to economic growth, and accommodating a large percentage of the labor force, this study has investigated the impact of Covid-19 on the tourism economy of Beijing (the capital of China), which is one of the leading tourist destinations of China. For this purpose, primary data with 385 sample sizes have been collected via random sampling techniques from the tourism-related respondents. This data has been analyzed using the simple descriptive analysis, graphical estimations, and categorization techniques. The findings of the study show that Covid-19 exerts a negative influence on the tourism and hospitality sector. Specifically, a reduction in the international tourists' arrival has reduced revenue generation, indirectly reducing the contribution to the GDP by many factors. These factors include an increase in the unemployment ratio, cut-off salaries, increases in expenditures, and a decline in the tax payments. However, lack of adequate response from the government in the context of the tourism sector has further fueled the adverse outcomes of Covid-19, leading the industry to a shut-down condition for most firms in this geographical area.
This study goal to scrutinize the influences of the COVID-19 pandemic on unemployment in five selected European economies. To this end, the study uses a Fourier causality test for the period of December-2019 to December-2020. In Z-test results, Germany, Spain, and the UK have a significant positive change in unemployment due to COVID-19. The finding shows that COVID-19 cases cause unemployment for Germany, Italy, and the UK. Moreover, in terms of deaths, COVID-19 also causes unemployment in Italy and UK. Overall, the study's outcomes highlight that the pandemic increases the unemployment rate robustly in the mostly European economies. That is one of the rare negative effects of the virus on the European labor market. Novel COVID-19 findings provide a reliable guide to the future policy implication for the labor market. An active labor market policy will be needed to be in front of the world urgently.
In this paper, we test the validity of the employment hysteresis hypothesis. For this purpose, we use daily employment data at the national and state levels in the United States from January 8, 2020, to May 30, 2020. We apply the modified version of the Kapetanios-Shin unit root test, along with finite-sample critical values. We find that the employment hysteresis hypothesis is valid in the United States during the COVID-19 era. The validity of the findings does not change when data at the national and state levels are used. The evidence is also valid when the employment levels for all firms and small firms are considered. The results are also robust to employment levels for workers at different income levels and employment in five different sectors.
During the recent COVID-19 outbreak, the crude oil market experienced enormous price fluctuations. A large number of researchers contended the volatility observed in oil market as unprecedented and it was immediately attributed to the pandemic owing to its globally devastating nature. Whether or not this attribution is justified, is the major question we have raised in this paper. We perform the comparative analysis of the volatility spasms of oil market during the COVID-19 pandemic (COVID-19), the Global financial crisis of 2008 (GFC) and the SARS outbreak of 2002–2004 (SARS). Preliminary investigation is conducted using two proxies of market sentiment which are oil price returns and oil price spread. For further investigations we apply symmetric GARCH (1,1) and the asymmetric GJR-GARCH (1,1) models. Our results based on skewness and kurtosis, indicate an extremely high degree of fat tail risk implying COVID-19 crisis as low probability yet high severity event a.k.a. black swan event. Our results further confirm the presence of volatility clustering (GARCH effect) along with the highest degree of asymmetry during COVID-19. These facts collectively make COVID-19 crisis more uncertain and pessimistic compared to the GFC and SARS.
This study's key purpose was to examine the impact of COVID-19 on SMEs' business norms and performance in China. The primary quantitative data have been collected through a survey questionnaire based on 330 participants. For analyzing the collected data, the use of the SEM technique has been made in this study. The researcher has adopted the data from the managers and employees belonging to the SMEs in China who are the research respondents. The data has been gathered from a sample size of 330. The number of distributed questionnaires was 340, whereas the responses gained were nearly 335, out of which 330 responses were selected. In the SEM technique, a CFA test was conducted to confirm the model's reliability and validity, whereas the results of path assessment were presented to examine the association between the variables. The findings of this study have confirmed the significant impact of COVID-19 on innovative operational procedures, profitability, remote work, and stakeholder satisfaction and safety.
Like the other spheres of economic activity, international trade is also a victim of the current Covid-19 pandemic. Therefore, taking this into consideration, this study examines the impact of the novel Covid-19 virus on international trade, by using monthly data from China and USA. For this purpose, we have referred to the novel Fourier causality test. The findings of the test show that there is a direct causal relationship between the Covid-19 related deaths and the exports and imports of China, while the Covid-19 cases do not have a causal relationship with the exports and imports of China in the pandemic. Moreover, the Covid-19 cases and deaths have a causal relationship with the exports and imports of USA. Thus, we found that there were heterogeneous effects experienced in both the countries. Based on these empirical findings, some policy implications have been suggested for the Chinese and USA economies.
Intuitively, it was clear that the pandemic situation and, more specifically, the lockdown and schedule limitations were going to affect communication practices. In general, during the COVID-19 situation, companies have replaced the commercial or external communication used in previous years with a more corporate-like communication. Therefore, in this article we intend to verify how companies have carried out their communication actions under the umbrella of corporate social responsibility (CSR) and the results obtained. In order to understand these changes, we have conducted a two-step sequential study that starts with in-depth interviews with Directors of Communication and concludes with a major survey of 214 companies. What this paper demonstrates is that communication practices have changed and are redirected towards CSR. This new communication discloses the measures that are being taken in relation to security, new sales, and product delivery alternatives, new services to older customers or customers at risk, to support employees for protection and conciliation, etc.—in short, a reorientation of communication towards CSR.
COVID-19 has triggered an unprecedented health crisis, crippling economic activity around the world. The aim of this paper is to analyse European countries' vulnerability to the associated consequences. The analysis will focus on three areas that a priori are expected to be most severely affected by the pandemic – health, society and work – examining the possible relationship with countries’ wealth. The multicriteria decision-making Technique for Order Preference by Similarity to the Ideal Solution (TOPSIS) will be used to generate a ranking of countries based on criteria that define each of these three areas. The findings will provide authorities with quantitative information to guide their aid policies. The results show that Eastern European countries should direct their resources towards addressing health-related and social issues. Conversely, those that have higher GDP per capita and that have been hardest hit by coronavirus will have to make changes to their labour systems in order to minimize the fallout.