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THE EFFECTS OF FOREIGN DIRECT INVESTMENT ON THE PERFORMANCE OF SMALL-MEDIUM ENTERPRISES: THE CASE OF VIETNAM

Author(s): Norbert Bozsik,Duong Minh Ngo / Language(s): English / Issue: 1/2023

Keywords: FDI; SMEs; globalization;

Foreign direct investment (FDI) is one of the most important elements influencing countries' international economic integration. FDI establishes direct, consistent, and long-lasting interconnections between economies as well as encouraging innovative technology and know-how transmission across territories while allowing host economies to offer their goods more extensively on global markets. FDI is also a source of investment financing that creates the climate for appropriate policies. Aside from the obvious advantages for all economic sectors, attracting FDI in small and midsize enterprises (SMEs) has a variety of additional benefits. For example, an opportunity to participate in the global supply chain for parts and components; an opportunity not yet wholly established in most developing nations but is critical for industrialization and improving income distribution through job creation for low-skilled employees. This study compared the impact of FDI on the performance of SMEs in Vietnam to that of a group of ASEAN nations with comparable economic structures including Indonesia, Malaysia, and Thailand. The empirical evidence indicates that FDI has a negative effect on the performance of SMEs in the group of four ASEAN member countries while having a positive influence on Vietnamese SMEs.

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THE IMPACT OF INSTITUTIONAL QUALITY ON ECONOMIC GROWTH: EVIDENCE FROM POST-SOVIET COUNTRIES

Author(s): Ilkin Gasimov,Gadir Asgarzade,Farid Jabiyev / Language(s): English / Issue: 1/2023

Keywords: economic growth; institutional quality; post-Soviet countries; Autoregressive Distributed Lag model;

The paper investigates the long-run impact of the institutional environment on economic growth for the sample of post-Soviet countries in 1996-2021. Using the Autoregressive Distributive Lag Model, we found that a U-shaped link exists between institutional quality and economic growth. Regarding the institutional quality dimensions, a similar link was observed for four out of six factors (POLSTAB, GOVEFF, RULELAW, CONTCORR). In contrast, the other two dimensions (REGQUAL, VOACC) exhibited inverted U-shaped impact on the dependent variable. Moreover, findings provide insight into the impact of control variables such as inflation (INF), openness (OPE), and population growth rate (POPGROWTH) on economic growth. More precisely, openness was found to have positive impact on the dependent variable, while inflation and population growth rate both had negative effect on economic growth. Based on these results, the paper suggests some policy implications for post-Soviet countries in terms of achieving economic growth by improving the institutional quality environment.

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IS FLEXIBILITY A DUAL MECHANISM? EVIDENCE FROM THE HUNGARIAN FOOD INDUSTRY

Author(s): Allam Yousuf,Judit Olah,Imran Sarihasan,Abdul Rauf,János Felföldi / Language(s): English / Issue: 1/2023

Keywords: mix flexibility; volume flexibility; product development flexibility; competitiveness; performance; food industry;

There is a body of evidence that flexibility as a mechanism can help to increase a company’s performance when an unexpected situation occurs. The food industry is considered one of the best industries and the performance of food industry undertakings accounts for 2.2% of Hungarian GDP. Food companies make up the third-largest manufacturing sector in Hungary. This study aims, therefore, to investigate the impact of operational flexibility on the performance of the Hungarian food industry by considering environmental uncertainty as a moderator. The research is cross-sectional. A customized questionnaire was used to obtain primary data. The questionnaires were distributed to a purposive group of managers, and there were 301 valid replies for statistical analysis. The findings revealed that operational flexibility has a beneficial impact on company success, while uncertainties in supply and demand do not have an effect on this link.

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IMPACT OF DIGITALISATION AND FOREIGN DIRECT INVESTMENT ON ECONOMIC GROWTH: LEARNING FROM DEVELOPED COUNTRIES

Author(s): Suhal Kusairi,Zun Yuan Wong,Ratri Wahyuningtyas,Muhammad Najit Sukemi / Language(s): English / Issue: 1/2023

Keywords: digitalised technology; foreign direct investment; economic growth; developed country;

In recent years, progress in digitalisation and foreign direct investment has caused many structural changes, reorganisation in economics, rising productivity, globalisation, and increasing trade or international investment flows, which have led to increased capital flows and information availability. Therefore, this research investigated the impact of digitalisation and foreign direct investment on economic growth in developed countries. Panel data analysis was applied to data of 16 developed countries, from 2006 until 2019. The findings show that digitalisation - presented by mobile cellular and internet users - and foreign direct investment positively impacted economic growth, thus they strongly contribute to advancing the economy and increasing welfare. Therefore, developed countries have been learning about the critical role of technology and capital, as stated by economists over several decades, and developing countries can copy their policies into their own economic strategies.

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DETERMINANTS OF INDONESIA’S SHRIMP COMMODITY EXPORT

Author(s): Lina Asmara Wati / Language(s): English / Issue: 1/2023

Keywords: export value; shrimp; random effect model; Indonesia;

For the last decade, Indonesia has exhibited enormous fishery potential, especially in shrimp commodities, in terms of quantity, export value, and annual production. In Indonesia, shrimp is the commodity with the highest number of transactions compared to other fishery commodities. This research on the factors of Indonesian shrimp exports can be used as a reference and provide more detailed information useful for the government and Indonesian shrimp exporters. Panel data regression analysis and the gravity model were used to obtain the best REM model using GLS. Research results indicated that the GDP per capita of the importing country, distance, and the population of the importing country significantly influenced the export value of Indonesian shrimp. At the same time, the exchange rate was an insignificant variable. Therefore, to increase Indonesia's shrimp export potential, the government and Indonesian shrimp exporters must consider to the importing country's GDP per capita and the selection of partner countries.

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ASYMMETRIC EFFECTS OF INFLATION RATE CHANGES ON THE STOCK MARKET INDEX: THE CASE OF INDONESIA

Author(s): Peck-Ching Sia,Choi-Meng Leong,Chin-Hong Puah / Language(s): English / Issue: 1/2023

Keywords: stock prices; macroeconomic fundamentals; financial economics; NARDL;

Over the years, macroeconomic fundamentals and the stock market were found to have symmetrical relationship in numerous scientific investigations. These fundamentals provide crucial knowledge regarding stock price indices by providing forecasts for the future and information on the current status of the economy. This study employs a Nonlinear Autoregressive Distributed Lags (NARDL) model to fill in the research gap by estimating the asymmetric relationship between inflation and stock market from 1996 to 2020. The study suggests that inflation has a long-run and short-run asymmetric affect on the stock price, while both positive and negative inflation changes harm stock prices. As it reveals, the asymmetric impact of inflation on the stock market, this study can assist investors and businesses in making well-informed decisions that result in a more efficient allocation of resources, ultimately benefiting the economy. Additionally, policymakers can utilize these findings to design effective strategies for managing inflation, stabilizing prices, promoting economic growth, and ensuring financial market stability.

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THE IMPACT OF CORRUPTION IN CLIMATE FINANCE ON ACHIEVING NET ZERO EMISSIONS

Author(s): Serhiy Lyeonov,Zdeněk Toušek,Victoria Bozhenko,Szilvia Erdeiné Kérmárki-Gally / Language(s): English / Issue: 1/2023

Keywords: climate finance; emissions; corruption; climate investment; survival analysis;

The study’s primary purpose is to assess the probabilistic impact of corruption in climate finance on achieving zero emissions. This scientific problem is highly relevant since the largest recipients of international climate assistance are countries with significant corruption in the public sector. Thus, it is necessary to increase the transparency in the use of international assistance funds and strengthen accountability. The study used the methods of survival analysis, namely the Kaplan-Meier approach and the Cox proportional hazards regression model, to investigate 114 countries that received international climate assistance during 2005-2021. The empirical analysis showed that the most probable time frame for achieving 5% reduction in greenhouse gas emissions is five years. Moreover, the response of climate finance to reducing greenhouse emissions is faster in countries with medium levels of corruption than in countries with high and very high levels of corruption. Two covariates (the level of corruption and the volume of climate finance) likely to affect the achievement of net zero emissions were chosen to build the Cox proportional hazards model. The study empirically confirms that with a 1-point increase in the Corruption Perceptions Index, the probability of reducing emissions increases by 2.4581%, while the volume of climate finance does not have a statistically significant impact on the performance indicator. It suggests that current climate investment in underdeveloped countries is incapable of mitigating the negative impact of climate change.

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GLOBAL ENVELOPE METHOD – NEW TREND IN DETERMINING ECONOMIC POTENTIAL OF RURAL AREAS

Author(s): Petra Pártlová / Language(s): English / Issue: 1/2023

Keywords: regional development; model of development potential model; the Czech Republic; rural areas;

This paper uses the narrative method to critically analyze theoretical approaches and concepts related to the development of rural areas and discusses the identified research gap that allows for the search for new concepts and methodologies for determining the economic potential of rural areas. In the study, various statistical methods, including the new global envelope method and permutation tests, were used to calculate the economic potential of the global model and individual sub-models of the rural areas´ potential. The achieved results suggest that the sub-model calculation is more complex and time consuming than the calculation of the global model. The comparison has also shown that the degree of relevance of the individual sub-models is lower due to the application of four sub-test statistics compared to the one test used in the global model. The selected process thus complicates the identification of false-positive significant variables. Based on the results, it can be stated that the significant variables identified in each sub-model affect the economic potential of a given sub-model, and thus the overall economic potential of the municipality, when compared to the variables identified in the global model.

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MODELS FOR ASSESSING CRISIS DYNAMICS IN DISPARITIES OF UKRAINE’S REGIONAL ECONOMY TO ENSURE THE ECONOMIC SECURITY OF REGIONS

Author(s): Olga Shevchenko,Zakharii Varnalii,Ganna Kharlamova,Nataliia Kuzmynchuk / Language(s): English / Issue: 1/2023

Keywords: regional economy; regional economic security; econometric modelling; catastrophes and bifurcations theory; dynamics of regional disparities; regulation of regional development;

The increase in the unevenness of indicators of regional socio-economic development in Ukraine is causing changes in regional economic security, in addition to the deterioration of national welfare. Therefore, there is a need to develop new theoretical and practical approaches for assessing such disparities and forecasting their dynamics. In this article, a toolkit for modelling crises and catastrophes in disparities of regional development is presented, using the example of Ukraine. The purpose of this study is to create models that assess the crisis dynamics in regional disparities in Ukraine, in order to develop tools for ensuring economic security in the region. To achieve this purpose, the following tasks have been identified: to evaluate convergent-divergent processes and the long-term interaction of regional disparity indicators; to simulate possible crises and catastrophes in various spheres of socio-economic development of regions according to the levels of their disparities; and to demonstrate the mutual dependence between disparities of the regions and levels of their economic security. The result of the crisis dynamic assessment is a set of predictive models of possible catastrophes that may occur in Ukraine's regions. This allows for obtaining reliable results for the qualitative analysis of stability factors of disparities in the socio-economic system, accounting for different time intervals that determine the peculiarities of the country's development. The array of constructed models is an effective tool for researching crisis processes in the dynamics of disparity indicators, as they allow for identifying and more thoroughly investigating non-linear cyclical processes in regional economic development, as well as predicting changes in levels of economic security. Such a toolkit allows for the development of a strategy for balanced regional and country development, and for ensuring regional economic security.

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THE FARMING COSTS (INCLUDING INSURANCE) OF THE AGRICULTURAL HOLDINGS IN THE EUROPEAN UNION

Author(s): Mykhailo Arych,Iuliia Kuievda,MAREK DVOŘÁK,Jana Hinke / Language(s): English / Issue: 1/2023

Keywords: agricultural holdings; farming costs; insurance; competitiveness; European Union;

The paper is devoted to exploring the farming costs (including insurance) indicators of the agricultural enterprises in the European Union. The analysis employs the box plot methodology that provides a five-number summary for a set of data. In this paper, we analyse the evidence of interconnection between the indicators of efficiency and competitiveness and insurance costs regarding food market security. This research discusses the dynamic changes of the absolute value of farming costs (including insurance) indicators and different relative indicators derived from the original one for the agricultural enterprise holdings in the European Union for the period of 2004-2019. The results show that farming costs (including insurance) indicators of the agricultural holdings should be considered as an instrument for providing food market security. Based on these research results, we are going to further explore the impact of insurance on the food market security. In addition, these research results could help to clarify the difference between EU countries and dynamic changes in farming costs (including insurance) indicators of agricultural holdings.

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ECONOMIC EMPOWERMENT AS A RESULT OF ACHIEVING SDGS WITH RESOURCE ACCESS: A COMPARATIVE RESEARCH BETWEEN GAZA STRIP AND HUNGARY

Author(s): Samia Nassar,Zsuzsanna Naárné Tóth,Laszlo Vasa / Language(s): English / Issue: 2/2023

Keywords: no poverty; zero hunger; resource access; economic empowerment; Hungary and Gaza Strip;

Donors, development agencies, and international non-governmental organizations are currently shaping a large part of the development and humanitarian agenda of sustainable developmen, especially regarding the first and second Sustainable Development Goals (SDGs) related to ending poverty and hunger worldwide. Thus, an increasing number of development interventions are aimed at protecting the planet and ensuring prosperity for everyone by strengthening the resilience of vulnerable households and communities. The research implemented a quantitative methodology approach that relied on distributing a survey based on the research variables. Data were collected in both the Gaza Strip and Hungary using google forms over a sample of 700 respondents, however, only 616 respondents filled out the survey. The collected data were analyzed using the SPSS statistical tool to research the impact of no poverty and zero hunger on economic empowerment and how resource access mediates this relationship. The research results were reported using descriptive and regression analysis, while mediation analysis was based on the method of Barron and Kenney. Most of the world's poor live in rural regions, and if we want to help them, we need to concentrate on developing agriculture in a modern and sustainable manner to create employment, increase farmers' incomes and consumption, and decrease food costs. Governments need to learn more about their strengths and challenges to aid communities in expanding. While primary agriculture may provide a viable income for those living in different regions, there is always the potential for diversification. Recognizing and capitalizing on other areas' variety or growth might significantly lower poverty levels. There is an urgent need to address the issue of food security, which requires a renewed commitment from governments, farmers, national policymakers, and international donors.

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UNVEILING THE IMPACT OF ECONOMIC AND POLITICAL GLOBALISATION ON THE EFFICIENCY OF MICROFINANCE INSTITUTIONS

Author(s): Fakarudin Kamarudin,Mohamad Khair Afham Muhamad Senan,Hafezali Iqbal Hussain,Janusz Michałek,Nazratul Aina Mohamad Anwar / Language(s): English / Issue: 2/2023

Keywords: microfinance institutions; economic globalisation; political globalisation; social efficiency; financial efficiency;

Microfinance Institutions (MFIs) strive to alleviate poverty by offering financial access and services to the poor in society. MFIs play a significant role in a country's social and economic advancement. This study aims to examine the relationship of the economic and political globalisation with the social and financial efficiency of MFIs in the Philippines and Malaysia from 2012 to 2020. There are two types of analysis adopted in this study: the non-parametric Data Envelopment Analysis (DEA) and the multiple panel regression model. In the first stage, the DEA approach is employed to determine the MFIs’ level of efficiency. Next, the determinants of financial efficiency and social efficiency are identified through panel regression. The results of the robustness test show that MFIs have better and more effective financial efficiency compared to social efficiency. Therefore, this result shows that the MFIs concentrate more on profitability and sustainability of the operations and they tend to neglect their primary goal in terms of the social function, i.e., reducing poverty, since the scores for financial efficiency are higher than those for social efficiency. Furthermore, the MFIs, government, policymakers, investors, and future researchers benefit from the outcomes of this study, as they can obtain a comprehensive insight on the efficiency of MFIs and the variables that could contribute to the efficiency in MFIs.

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BUSINESS – EDUCATION COLLABORATION IN R&D INVESTMENT: ANALYSIS OF DEVELOPMENT GAPS AND CRITICAL POINTS USING MAR-SPLINES

Author(s): Anastasiia Samoilikova,Jarosław Korpysa,Tetiana Vasylieva,Bálint Filep / Language(s): English / Issue: 2/2023

Keywords: business; coopetition; development gaps; education; R&D investment; sustainable development; splines;

The purpose of the article is to determine development gaps and critical points in the system of business – education collaboration in R&D investment using MAR-splines. The study attempts to confirm hypotheses about the impact of business – education collaboration in R&D investment on the sustainable development, and, in turn, the influence of chosen factors on the level of cooperation of business and education in R&D investment taking into account development gaps and critical points. These factors include the values of gross domestic expenditure on R&D spent by the business enterprise sector and by the higher education sector, and the level of the informal economy. The study is based on the sample of the 10 countries leading the ranking of Sustainable Development Index for 2011-2018 (time limits are set due to the availability of all studied indicators in the statistical databases of the World Bank, UNDESA, OECD and WIPO). Critical points and knots are determined using MAR-splines and two-way median-spline plots in STATA software. It has been proven that the business – education collaboration in R&D investment contributes to increasing the level of sustainable development if the value of this indicator is in the range of critical points from 62.04 to 68.96 (1% growth increases the estimate of sustainable development by 0.7%). In turn, development gaps and critical points have also been found for factors influencing the level of business-education R&D collaboration.

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THE EFFECT OF RUSSIAN UNFRIENDLY-COUNTRY LIST AND IMPORT BAN: GRAVITY FRAMEWORK TEST

Author(s): Mikhail Krivko,Stanislava Kontsevaya,Luboš Smutka / Language(s): English / Issue: 2/2023

Keywords: international trade; Russian import ban; unfriendliness; gravity model;

Since 2021, Russia has maintained a list of unfriendly countries. This list and the import ban list introduced in 2014 are some of the main economic sanctions Russia uses to influence trading partners. This paper attempts to quantify the effect of putting a trading partner on the list of unfriendly countries compared to the Russian import ban. The study uses the data on trade flows between Russia and its trading partners from the UN COMTRADE database for select agri-food products. Employing a gravity framework, we argue that countries added to the unfriendly list in 2022 often had already lost a significant part of exports due to the 2014 Russian import ban introduction. Thus, such countries did not experience significant change compared to the effects of the Russian import ban. Based on this conclusion, Russia has a limited capacity to apply such retaliatory measures to Western countries regarding agri-food trade. Our results also demonstrate that the presence of the import ban drives export flows of the studied products, while the GDP of the trading partner also plays an important role, albeit with a lower magnitude.

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PREREQUISITES AND SCENARIOS FOR THE EU ECONOMY TRANSFORMATION INLIGHT OF INDUSTRY 4.0 DEVELOPMENT

Author(s): Inessa Sytnik,Artem Stopochkin,Janusz Wielki,Said Edaich,Bogdan Sytnik / Language(s): English / Issue: 2/2023

Keywords: European Union economy; economic model; Industry 4.0; economic development; scenarios of economic development;

The purpose of this study is to verify the condition of European Union economy and its ability to effectively implement the concept of sustainable development in the era of the fourth industrial revolution. To achieve the goal settled by this research, we used the technical indicator MACD (Moving Average Convergence / Divergence), based on the assessment of the convergence and divergence of moving averages of macroeconomic indicators. The studies carried out made it possible to identify three scenarios for the state of the EU economy after 2022. All these scenarios pose a high risk of a crisis phenomena in this economic system. According to the optimistic scenario, after 2022, a downward correctional wave is predicted in the EU-27 economy with the emergence of a situation similar to the situation in 2008. The search for a new economic model based on the active implementation of Industry 4.0 technologies can become a way for the EU economy to recover from the crisis and move to a qualitatively new level of socio-economic development.

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TESTING THE PREDICTABILITY OF THE SAUDI MARKET INDICES RETURNS: EVIDENCE FROM TADAWUL MARKET

Author(s): Farouq Altahtamouni / Language(s): English / Issue: 2/2023

Keywords: market efficiency; normality test; runs test; variance ratio test; unit root;

The purpose of this study is to determine whether the market index returns and sectoral indices returns in the Saudi stock market (TADAWUL) follow a random walk process as stated by the efficient market hypothesis for the years 2011-2020. The normal distribution test, runs test, variance ratio test, and Augmented Dickey-Fuller (ADF) were used to check the study hypotheses. At the weak-form level, the empirical findings reject the random walk hypothesis, indicating proving that not all historical data is completely reflected in stock prices. The study's conclusions are significant for Saudi stock market investors who are forming investment portfolios resemble to the market's portfolio.

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THE IMPACT OF EUROPEAN MONETARY INTEGRATION ON M&A VOLUME IN THE CONTEXT OF THE BANKING MARKET CONSOLIDATION

Author(s): Ivana Kravčáková Vozárová,Stela Kolesárová,Martina Košíková,Jaroslava Hečková,Alexandra Chapčáková,Beata Gavurova / Language(s): English / Issue: 2/2023

Keywords: cross-border merger and acquisition; banking sector; European monetary integration; consolidation; European Union; European area;

Over the last two decades, the banking sector in Europe has undergone significant changes in terms of regulations and market structure, which resulted in a significant increase in M&A transactions. The rise of M&A activity was also a consequence of fundamental changes in the external environment, such as introduction of the euro, technological progress and changing customer demand. The aim of this contribution is to compare the impact of the integration of the countries in the European Monetary Union on the volume (value) and number of realized M&A. The Mann-Whitney U test was used to verify three individual hypotheses. The results of the analysis did not confirm differences in the volume and number of M&As between EMU and non-EMU countries (with the exception of 2 years).

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Identifying quality gaps in tourism for people with disabilities: Importance-Performance Analysis (IPA)

Author(s): Teresa Skalska / Language(s): English / Issue: 1/2023

Keywords: tourism of people with disabilities; Importance-Performance Analysis; quality gaps

The aim of the article is to assess the significance (importance) and level of inconvenience of selected attributes of tourist services provided at particular stages of the supply chain in tourism (information, accommodation, transport, organization and intermediation) in relation to people with various types and degrees of disability. The survey conducted among the disabled helped to identify quality gaps in the provision of tourism services, taking into account their complementarity and accessibility at every stage of delivery. The method of Importance-Performance Analysis (IPA) and basic measures of descriptive statistics were used to analyze empirical data. The study will help to indicate to what extent the tourist experience of a disabled person and the type of disability affect the assessment of the significance (importance) and inconvenience of selected attributes of tourist services. The results of the research can be used by entrepreneurs to analyze the quality and reliability of services provided by their partners and the behavior and needs of the disabled in tourism. They will also be useful for local and regional authorities responsible for ensuring the competitiveness and inclusiveness of tourism regions.

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The musicscape in hotel businesses: Evidence from online reviews

Author(s): Ozan Çatir / Language(s): English / Issue: 1/2023

Keywords: hotels; online reviews; musicscape; content analysis; customer behavior

Musicscape is an important topic in tourism and hospitality contexts. However, there are few studies on this subject in the accommodation sector. The study aims to determine the effect of ‘musicscape dimensions’ on customer behavior. To achieve this aim, 2357 online reviews of 28 hotels in Antalya, Turkey were analyzed by content analysis. The framework proposed by Oakes was used in the study. The research findings provide hotel managers with practical advice on the effective use of musicscape in tourism and hospitality settings. In addition, it was concluded that customers evaluated the loudness and fast tempo of music negatively, and that the harmony of music broadcasts and their environment offered by a hotel is positively perceived by customers.

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Opportunities for evaluation of sustainable tourism – assessing the availability of ETIS indicators in Poland

Author(s): Agnieszka Niezgoda / Language(s): English / Issue: 1/2023

Keywords: sustainable tourism; ETIS indicators; destination management

The purpose of the article is to evaluate the possibilities of evaluating sustainable tourism in Polish tourist regions, in particular, through the use of ETIS indicators and to assess for the availability of data for their calculation in the nationwide statistical system. Qualitative research methodology was used to study the availability of ETIS indicators. A diagnostic type research procedure was adopted and the desk research method was used. In a situation where the data necessary for calculating a given indicator was not found in the available sources, primary research in the form of direct interviews with representatives of branches of Statistical Offices was used. In order to quantify the availability of ETIS indicators, a system for their evaluation was adopted and aggregate indicators were proposed for the evaluation of sections and individual criteria in the section, which is the author’s attempt to develop a unified system for evaluating sustainable tourism indicators.The results of the study showed that the availability of data for calculating ETIS indicators in Poland is not satisfactory. The lowest rating was given to the availability of indicators that facilitate the management of the resort, including the tourists’ satisfaction survey (section A). Also rated very low was the availability of indicators of the environmental impact of tourism in a resort (section D). The results obtained confirm the results of studies by other authors dealing with the issue of the real use of ETIS in tourist regions of other countries.

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