Template-Type: ReDIF-Article 1.0
Author-Name: Dragana Radjen
Author-Name: Nemanja Stanisic
Title: Financial Distress and Managerial Turnover: The Case of the Republic of Serbia
Abstract: This study examines the influence of financial distress on top management turnover in the Republic of Serbia over the period January 2009-June 2015. Using a sample of 86 large and medium-sized privately owned companies that adopted a reorganisation plan in bankruptcy, we found out that top management was changed in 33 companies. A logistic regression provides evidence that probability of top management turnover is significantly correlated with the company’s size (positive correlation) and the ownership concentration (negative correlation). The influence of the company’s financial performance, applied bankruptcy proceedings and debt monitoring of top management turnover was deemed to be statistically insignificant (at 5% and 10% significance level). Obtained results provide the proof that corporate governance mechanisms in distressed Serbian companies are not efficient.
Keywords: bankruptcy, distress, top management turnover
Classification-JEL: G33, G34
Pages: 646-660
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=628.pdf
File-URL: http://www.vse.cz/pep/628
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:628:p:646-660
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Template-Type: ReDIF-Article 1.0
Author-Name: Arkadiusz Sieroń
Title: Inflation and Income Inequality
Abstract: The aim of this paper is to examine the relationship between inflation and income inequality. The article is mainly theoretical, but considerations presented are illustrated by relevant empirical data. Based on our analysis, we claim that inflation, which accelerated after the collapse of the Bretton Woods system in 1971, could have contributed to the rise in income inequality in the USA since the 1970s. Our article transcends the simple notion of an inflation tax and focuses on other redistributive mechanisms of inflation (Cantillon effect) as one of the main causes of income inequality.
Keywords: inflation, redistribution, income inequality, Cantillon effect, wealth inequality
Classification-JEL: D31, E31, E51
Pages: 633-645
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=630.pdf
File-URL: http://www.vse.cz/pep/630
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:630:p:633-645
X-File-Ref: http://www.vse.cz/RePEc/prg/jnlpep/references/630

Template-Type: ReDIF-Article 1.0
Author-Name: Myoung Shik Choi
Title: The Recent Effects of Exchange Rate on International Trade
Abstract: This paper investigates effects of the real exchange rate and its volatility on trade balance and real GDP using a set of eighteen countries, mainly the OECD developed countries. The paper reports econometric procedures and empirical estimates for major currency-owned large economies and non-major currency-owned countries. One task, for which the elasticities of international trade and real GDP are needed, is developing exchange rate assessments. The study finds that real currency depreciation leads to improvement of trade balance in most of the examined developed countries. But the trade balances after real depreciation of currency do not follow J-curve patterns. With regard to the real exchange rate variability, the evidence is mixed. Similarly, effects of the real currency devaluation on real GDP differ across countries. Also, we observe that major currencyowned countries could have different value-and-volume-effects with non-major currency countries.
Keywords: exchange rate, cointegration, unit root, GDP, trade balance, causality, FX volatility, major currency, shock response, VAR model, VEC model
Classification-JEL: F31, F32, F40
Pages: 661-689
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=632.pdf
File-URL: http://www.vse.cz/pep/632
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:632:p:661-689
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Template-Type: ReDIF-Article 1.0
Author-Name: Narcisa Kadlčáková
Author-Name: Luboš Komárek
Title: Foreign Exchange Market Contagion in Central Europe from the Viewpoint of Extreme Value Theory
Abstract: This paper examines contagion in the foreign exchange markets of three Central European countries and the euro area. Contagion is viewed as the occurrence of extreme events taking place in different countries simultaneously and is assessed with a measure of asymptotic tail dependence among the studied distributions. Currency crisis contagion is one strand of this research. However, the main aim of the paper is to examine the potential of bubble contagion. To this end the representative exchange rates are linked to their fundamentals using a cointegration approach. Given the long-time range required by cointegration testing, the variables are first tested for unit roots with structural breaks, whose existence is supported by these tests. In the sequel, the extreme values of the differences between actual daily exchange rates and their monthly equilibrium values determine the episodes associated with large departures from equilibrium. Using tools from Extreme Value Theory, we analyse the transmission of both standard crisis and bubble formation events in the examined currency markets. The results reveal a significant potential for contagion in the currency markets of Central Europe.
Keywords: exchange rate, extreme value theory, contagion
Classification-JEL: C58, E44, G12
Pages: 690-721
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=634.pdf
File-URL: http://www.vse.cz/pep/634
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:634:p:690-721
X-File-Ref: http://www.vse.cz/RePEc/prg/jnlpep/references/634

Template-Type: ReDIF-Article 1.0
Author-Name: Tomáš Cipra
Author-Name: Radek Hendrych
Title: Some Forms of Risk Regulation in Solvency II
Abstract: The contribution deals with the risk regulation in the framework of Solvency II, which is the new regulatory system in insurance valid in majority of the EU countries since 2016. It concentrates on the underwriting risk (in particular, on the reserve risk) and on the counterparty default risk (i.e. mainly on the reinsurers’ default risk), since such risks are crucial for insurance activities. Various actuarial approaches to the underwriting risk applied by subjects respected by insurance regulators and supervisors are surveyed. Moreover, one of them suggests by means of a real data example a simplified approach to the reserve risk, which may be appreciated in practice just for its simplicity. As to the counterparty default risk, the paper presents a method that can be suitable when the reinsurers form a small group of heterogeneous subjects imperilled by a common shock as a financial crisis or a natural catastrophe; this methodological approach is also demonstrated by a numerical example.
Keywords: Solvency II, underwriting risk, risk regulation, reserve risk, technical provisions, counterparty default risk, actuarial methods
Classification-JEL: C02, G22, G28
Pages: 722-743
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=638.pdf
File-URL: http://www.vse.cz/pep/638
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:638:p:722-743
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Template-Type: ReDIF-Article 1.0
Author-Name: Halit Yanikkaya
Author-Name: Hasan Karaboga
Title: The Effectiveness of Investment Incentives in the Turkish Manufacturing Industry
Abstract: This study investigates the impact of investment incentives on sectoral labour productivity, capital intensity, employment and total factor productivity using data on sixteen manufacturing industry sectors in Turkey during the post-liberalization period. To deal with potential endogeneity of the investment incentives, we apply the system GMM estimation technique to the panel dataset for six five-year periods between 1981 and 2009. Our overall GMM estimations indicate that we fail to find any evidence that investment incentives positively affect anyone of our macroeconomic variables. While investment incentives do not increase the employment growth and total factor productivity growth significantly, they significantly reduce the growth rate of value added per work hour and capital stock per work hour. Given that since the early years of the Turkish Republic, investment incentive systems have always been an important part of the industrialization policies; our results have essential implications for the design and effectiveness of investment incentives.
Keywords: employment, productivity, investment incentives, panel data analysis, output
Classification-JEL: H25, O38, R0
Pages: 744-760
Volume: 2017
Issue: 6
Year: 2017
File-URL: http://www.vse.cz/pep/download.php?jnl=pep&pdf=641.pdf
File-URL: http://www.vse.cz/pep/641
File-Format: text/html
Handle: RePEc:prg:jnlpep:v:2017:y:2017:i:6:id:641:p:744-760
X-File-Ref: http://www.vse.cz/RePEc/prg/jnlpep/references/641