Template-Type: ReDIF-Article 1.0
Author-Name: Jiří Jonáš
Title: Economic and monetary union accession and capital flows
Abstract: The paper discusses the prospects for capital inflows to the Czech Republic before Economic and Monetary Union accession. It reviews the potential costs and benefits of capital flows and the history of capital flows to the Czech Republic, before turning to future capital inflows. It notes that different theoretical models provide different predictions about future capital inflows. To get further insight, the paper discusses the future capital inflows from the perspective of nonresidents' supply of external savings and residents' demand for external borrowing and from the perspective of external vulnerability related to large foreign direct investment (FDI) inflow. It concludes that FDI is likely to decline somewhat in the future, but increasing sovereign borrowing needs could lead to higher inflow of portfolio capital. The final section discusses the potential for capital inflows resulting from the so-called convergence plays and concludes that there is presently little incentive for convergence-play related capital inflows.
Keywords: foreign direct investment, EMU accession, capital flows, external vulnerability, convergence play
Classification-JEL: F21, F32, F36, G15
Volume: 2003
Issue: 3
Year: 2003
File-URL: http://www.vse.cz/pep/214
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2003:y:2003:i:3:id:214

Template-Type: ReDIF-Article 1.0
Author-Name: Žan Oplotnik
Title: Bank of slovenia adjustment policy to surges in capital flows
Abstract: The article presents an empirically tested assessment of the Bank of Slovenia (BS), national central bank, adjustment policy to surges in capital flows during the last decade. Exchange rate appreciation, undeveloped banking sector, immoderate money market oscillation, unstable economic trends (all phenomena that can also be found in other transition countries) are just some of the detrimental effects that can be provoked by surges in capital flows if the national economy is faced with some fundamental sectoral deficiencies. Empirical results indicated that BS quite successfully mitigated listed effects of excessive foreign currency inflows during the last decade. With the suitable combination of direct and indirect adjustment methods, BS succeeded in preventing, still vulnerable Slovenian economy from a major form of financial crisis and stronger nominal tolar appreciation (this was not the case in some other countries like Hungary, Poland, Czech Republic, Croatia) although there was some real appreciation.
Keywords: capital flows, central bank policy, exchange rate regime, appreciation, capital controls, problems of transition
Classification-JEL: C10, C13, E58, F31, F32, F36, G18
Volume: 2003
Issue: 3
Year: 2003
File-URL: http://www.vse.cz/pep/215
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2003:y:2003:i:3:id:215

Template-Type: ReDIF-Article 1.0
Author-Name: Patrik Bauer
Author-Name: Vít Bubák
Title: Informative value of firm capital structure
Abstract: In this paper, the informative value of firm capital structure is analyzed. In the first part, a theoretical background regarding capital structure theories is presented. In the second (empirical) part, the Ohlson (1995) valuation framework is used in order to analyze the informative value of firm capital structure on a sample of data for the Czech (non-financial) companies. A contextual approach is adopted and the value relevance of debt is analyzed considering the signalling and the optimal capital structure theories. According to the results and in accordance with the optimal capital structure theory, debt is more penalized in case of the companies that deviate from the target debt level. Moreover, debt proves to be a positive signal for the firms with a higher earnings growth potential. This, in turn, is consistent with the signalling theory.
Keywords: conditional capital structure theories, Ohlson valuation model, optimal capital structure theory, signalling theory
Classification-JEL: G10, G32
Volume: 2003
Issue: 3
Year: 2003
File-URL: http://www.vse.cz/pep/216
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2003:y:2003:i:3:id:216

Template-Type: ReDIF-Article 1.0
Author-Name: Fuhmei Wang
Title: Leakages in dual exchange markets
Abstract: The issue of determining inter-market foreign exchange flows under dual exchange markets has been hotly debated. Typically the literature has concentrated on the behavior of the financial premium, leaving aside equally important aspects such the reasons for and characteristics of incomplete separation. Our analytical results suggest that cross transactions arise as long as the government changes the commercial rate. Time inconsistency of policy brings opportunity for leakages between two markets. We also find that the more patient the government, the less likely the occurrence of commercial depreciation and leakages will be. Then reputation could be as a deterrent to leakages.
Keywords: dual exchange markets, leakages, reputation
Classification-JEL: F32, F33, F41
Volume: 2003
Issue: 3
Year: 2003
File-URL: http://www.vse.cz/pep/217
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2003:y:2003:i:3:id:217

Template-Type: ReDIF-Article 1.0
Author-Name: Marek Loužek
Title: Can pro-natalist policy be effective?
Abstract: The article is concerned with pro-natalist policies, examining empirically their effectiveness. There are proposed four hypotheses: continuous decline of the birth rate; adaptive model; natural-rate hypothesis; crowding-out hypothesis. Nine countries are tested: Germany, Italy, Sweden and France before the World War II and Romania, Bulgaria, Czechoslovakia, Hungary and East Germany during the communism. Best empirical results arise from the crowding-out hypothesis. Good results follow from the adaptive model and the continuous decline of birth rates. The natural-rate hypothesis has small explanatory power. Pro-natalist policies, according to this study, are not too effective.
Keywords: population policy, pro-natalist sentiment, static model, dynamic model, constant decline in the birth rate, adaptive model, natural-rate hypothesis, crowding-out hypothesis
Classification-JEL: C22, C52, J11, J13
Volume: 2003
Issue: 3
Year: 2003
File-URL: http://www.vse.cz/pep/218
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2003:y:2003:i:3:id:218