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In this paper, estimates of tax losses as a result of aggressive tax planning are presented using two different methodological approaches. While the International Monetary Fund (IMF) methodology addresses profit shifting and corresponding tax losses across the European Union, the United Nations Conference on Trade and Development (UNCTAD) methodology uses FDI data and a list of so-called offshore financial centres. According to the IMF methodology, the annual tax losses are about EUR 69–105 billion for the EU-28. According to our calculations, the Czech Republic achieves negative losses (tax revenues) of CZK 15 billion per year, probably due to the low effective tax rate (16.4%) and investment incentives. On the other hand, the UNCTAD methodology implies annual tax losses for a given EU member state of about EUR 18 billion. Because of limited data availability, we estimated the regression model for only 22 EU member states for the period 2013–2016.
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This paper explores the role of spatial effects in the innovation processes across 245 NUTS-2 European Union (EU) regions for the period 2008–2012. The goal of the paper is to verify two hypotheses. The first one deals with spatial autocorrelation, i.e., our assumption is that the regional innovation process is not a spatially isolated process but is determined by innovation activities in neighbouring regions as well. Secondly, we assume non-homogeneous responses of innovation output to changes in innovation inputs across groups of regions, i.e., a spatial heterogeneity hypothesis. Patent applications were chosen as a proxy for innovative activity and we considered research and development expenditures and human resources in science and technology as innovation inputs. In order to model the behaviour of innovative activity at the EU regional level, we constructed and estimated a spatial regional knowledge production function model and spatial regime models. The results of the analysis confirm the hypothesis that the regional innovation process is not a spatially isolated process but is also influenced by innovation activities in neighbouring regions, and we have also identified two spatial innovation regimes.
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The analysis builds on existing empirical and theoretical literature in the field of job polarization, which is primarily focused on advanced economies. Hypotheses of the incidence of “skill-biased” and “routine-biased” technical change in the Visegrad group countries are verified in the analysis. The aim is to find out whether the impact of technical change on the labour market in the V4 countries is similar to or different than that in advanced economies. The analytical part is primarily performed on the EU-LFS. The results suggest that the structure of the labour market has changed in the V4 countries in a heterogeneous way. In Hungary and Slovakia, there was an apparent slight job polarization over the period under review. In addition, the evidence suggests that the technical change in these countries may be of a “routine-biased” nature. On the contrary, the pattern of "upgrading" was evident in the Czech Republic and Poland, where the evidence suggests "skill-biased” technical change.
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In the study, we focus on examining the impact of selected factors on the results of electronic reverse auctions and thus the savings achieved. The study extends the knowledge of extant literature to empirical insights and uses currently the broadest sample of approximately 16,000 e-auction cases. The study confirms that the savings calculation method and the use of a comparative or initial price affect the outcome of the auction as well as the individual selected factors entering the model (e-auction value, number of changes, number of extensions, number of bidders, number of items).
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Ambiguous terminology as well as causality and a too wide spectrum of determinants on the demand side of the welfare state are the main drawbacks in the literature on the topic. The aim of this paper is to systematise the literature on individual support for the welfare state. Besides clarification of the terminology and argumentation of prevailing causality (informal institutions → individual support for the welfare state), the paper underlines the importance of individualist values and beliefs; in particular, individual control over one’s own life, which can be based on the psychological concepts of locus of control and self-efficacy and can be empirically tested thanks to the WVS/EVS databases.
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Dominik Stroukal: Ekonomické bubliny – kdo je nafukuje, proč praskají a jak v další krizi neztratit všePraha: Grada, a.s., 2019. 1. vydání, 240 stran. ISBN 978-80-271-2194-6.
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Stanislava Hronová, Jakub Fischer, Richard Hindls, Jan Sixta: Národní účetnictví – od výroby k bohatstvíPraha: C. H. Beck, 2019. 1. vydání. 432 stran. 978-80-7400-738-5.
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We investigate the impact of the Czech Republic’s membership in the European Union on capital mobility. Our estimation of capital mobility is based on the alternative Feldstein-Horioka model. The model comes from intertemporal budget constraints with the additional assumption of a different data generation process. We propose an empirical framework to capture two different regimes in the vector error correction model. We show that the period 1996–2004 is composed of both regimes. The most important conclusion is that the period 1996–2004 is connected with a mix of both regimes. However, the period 2005–2017 comprises only one regime, which is connected with higher capital mobility. Therefore, capital mobility in the Czech Republic increased after 2004.
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The article aims to analyse the effects of the start-up subsidy programme for unemployed in the Czech Republic, which is provided by the Ministry of Labour and Social Affairs. We explored to what extent participants in the programme in 2014 returned to unemployment three years after the end of the programme, i.e., 2014–2017. Methodologically, we conducted counterfactual impact analysis, where we matched participants in the programme with those who were not supported by any measures of active labour market policy. The results show that participants in the programme return to unemployment to a lesser extent. In total, they spent fewer days in unemployment during the follow-up period, and they returned to unemployment fewer times when compared with non-participants. Overall, 91.3% of participants never returned to unemployment during the analysed period. These results can be interpreted as a positive outcome of the programme. The article also offers implications for targeting the programme and for future research.
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The paper analyses episodes of successful reduction of public debt in OECD countries. From 2008 to 2018, we identify 19 episodes of fiscal consolidation, of which five resulted in a significant debt reduction. The most successful post-crisis concept is extensive, long-term consolidations and consolidations started with excessive initial debt. Spending cut consolidations have not been significantly more successful than the tax increase approach. After the inclusion of projections for 2019 and 2020, we identified 18 episodes of significant debt reduction, of which nine were associated with previous fiscal consolidation and nine were not. In the years after successful consolidation, the primary balance surpluses were more effective in debt reduction than the macroeconomic environment. Economic growth and interest rates in the significant debt reduction episodes associated with previous consolidation were lower than those without that connection. Countries which have achieved significant debt reduction without previous consolidation have done so primarily by better macro development and profited from a lower level of indebtedness.
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This paper deals with the absolute version of purchasing power parity and its applicability in transition economies. The aim of the paper is to identify and quantify deviations between nominal exchange rates and rates based on purchasing power parity. The paper specifies and analyses the theoretical causes of those deviations and focuses on the impact of prices of non-tradable goods on purchasing power parity. Parity exchange rates based on prices of tradable-only goods are then calculated for 20 transition economies. Panel regression instruments are used to analyse the influence of selected macroeconomic and institutional variables on deviations between nominal exchange rates and rates based on purchasing power parity.
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For millennia, there have been two credit theories in the Western tradition and two types of credit institutions derived from them. One focused on raising capital for investment purposes, the other dealing with lending of money to private individuals for consumption. This distinction, which is the key to understanding ancient and medieval economic thought, not only allows us to better understand the question of usury in the past, but is also the key to a proper understanding of the development of European credit markets, which have evolved in two ways – investment banking and retail banking. Particular attention is paid to benevolent credit institutions, which laid the foundations for European retail banking.
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Tran Van Quang: Makroekonomické modely pro měnovou analýzuPraha: Vysoká škola ekonomická v Praze, Nakladatelství Oeconomica, 2019. 1. vydání. 250 stran. ISBN 978-80-245-2305-7.
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The paper investigates the extent and reasons for restatements of financial statements by Czech firms. In 2013, Czech accounting regulation was amended to remove inappropriate accounting treatment for prior period errors and changes in accounting policies. A sample of 3,407 financial statements for the period 2013–2017 also includes a significant amendment to accounting standards in 2016. The combination of both amendments creates a quasi-natural experiment enabling investigation into firms’ response to regulatory changes. Empirical analysis shows that restatements occurred in 7.4% of the cases. Using non-parametric tests, we found that restatements are more frequent in joint-stock companies and that corrections of prior period errors dominate over changes in accounting policies. An expected one-time increase in restatements in 2016 is confirmed; however, the hypothesis that increased restatements are driven by changes in accounting policies required by new GAAP can be neither confirmed nor refuted. The main cause is that over 50% of the entities did not disclose their reason for restatement, despite the fact that disclosure is mandated by accounting standards and all financial statements are audited.
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This paper explores whether downward rigidity in nominal wages has negative impacts on the economy in the case of deflation caused by economic growth. In this situation, growth of real wages may be delivered by a fall in the price level even if nominal wages are constant. Hayek’s proposal to stabilize MV is studied in detail. The nominal GDP is stabilized within this framework, and when potential output is growing, the price level might decrease. It is derived that this Hayekian rule would lead to a fall in nominal wages in an economy with positive population growth, which restricts the space for deflation. Friedman’s proposal to stabilize prices of factors of production is also examined. It results in weaker deflation than Hayek’s proposal and no need for decrease in nominal wages. The next part of the article demonstrates that the Hayekian framework may not require a fall in nominal wages in a converging economy if the labour share of income is gradually increasing, even if population growth is positive.
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The aim of this paper is to evaluate relative over-investment or under-investment of economies. To achieve this, we build a panel regression for 122 countries, where rates of investment and capital-output ratios are explained by key fundamental variables stemming from the theory in Chapter 1. We present implied-equilibrium values for both variables and all the countries in the sample. Countries of the former Soviet Union, the USA and Germany, for example, were identified as relatively underinvested. Large Asian economies such as China, India and Indonesia, and some countries of Latin America and Africa appeared to be overinvested. No significant imbalance was identified for Czechia, Slovakia and Hungary, while Poland showed to be relatively underinvested.
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The aim of this paper is to specify the determinants from the real economy causing long-term disequilibrium in the trade balance. The analysis is carried out for all countries of the world for the period 1980–2016 (according to data availability) using panel and cross-sectional regression. We employ the absorption approach as the basic theoretical model. From the supply side of the economy, the main determinants are: export of primary resources, e.g. oil and gas, geographical factors and institutional quality of the economy. From the demand side of the economy, the trade balance is influenced mainly by the demographic structure of the population and its consumption, saving and investment habits in the context of life cycle hypothesis, marginal propensity to consume and the participation of the government sector in the economy (e.g. health care provision, social security, etc.).
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This paper addresses Czech international exports from 2000 to 2017. The goal of the paper is to determine whether the economic sanctions imposed on the Russian Federation by most of the Western countries, and especially the countermeasures adopted by the Kremlin, have exercised any significant effect on the Czech exports to Russia. The approach adopted is a gravity model and the results lead to the conclusion that the economic sanctions do not have any significant effect on the global Czech exports to Russia. Nevertheless, the sanctions affect the type of future economic cooperation between the Czech Republic and the Russian Federation.
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