Prague Economic Papers, 2018 (vol. 27), issue 3

Original contributions, Original article, Research article

Corruption - A Dark Side of Entrepreneurship. Corruption and Innovations

Marek Tomaszewski

Prague Economic Papers 2018, 27(3):251-269 | DOI: 10.18267/j.pep.647  

In this article, corruption is treated as an expression of human entrepreneurship, which does not fully fit in the commonly accepted moral and legal standards. Despite being negatively perceived, it is persistently present in the public, economic and political life of every country as evidenced by a number of press releases on corruption.Research literature analysis reveals the existence of two conflicting opinions with regard to the way in which corruption affects innovative activity of companies and economic growth. The more morally correct theory, which can be dubbed the sand-the-wheels theory, assumes that corruption negatively influences...

Interrelationship and Spillover Effect between Stock and Exchange Rate Markets in the Major Emerging Economies

Jovan Njegić, Dejan Živkov, Irena Janković

Prague Economic Papers 2018, 27(3):270-292 | DOI: 10.18267/j.pep.669  

This paper analyses the dynamic nexus and bidirectional spillover effect between stocks and exchange rates in seven major emerging markets and one developed market. Three types of BEKK-GARCH models were utilized in the research process - basic BEKK-GARCH, asymmetric BEKK-GARCH and asymmetric BEKK-GARCH with structural breaks. Model with breaks gave the best fitting results in six out of eight cases. VAR based volatility spillover method serves as a complementary methodology. Results showed that dynamic connection between two major asset classes behaves in accordance with the portfolio balanced approach in emerging markets, while the nexus is in line...

Survey of Volatility and Spillovers on Financial Markets

Evžen Kočenda

Prague Economic Papers 2018, 27(3):293-305 | DOI: 10.18267/j.pep.650  

In this survey article, we present a rich extent of literature on volatility and its propagation on financial markets via spillovers. We document how new approaches or improved existing methodologies lead to results that offer richer insights than those derived from standard econometric techniques. Moreover, the implications of the results can be related to a wide set of markets as the surveyed articles cover emerging and developed European markets as well as the United States.

Pre-Crisis Wage Leadership in Croatia in the Context of Export Competitiveness: Any Lessons for the Future?

Goran Vukšić

Prague Economic Papers 2018, 27(3):306-330 | DOI: 10.18267/j.pep.655  

This study explores the determinants of sectoral wage dynamics in Croatia, including inter-sectoral wage linkages, using both panel data methods and Granger causality analysis. Given the large deficits in Croatian merchandise trade and accumulated external liabilities, wage formation in the exporting sectors receives a particular focus. It has been found that exporters are wage leaders and that labour productivity is a more important wage determinant for the exporting sectors than for other sectors. Public sector wages do not affect wages in private sectors. There are, however, wage spillovers within the group of exporting sectors and possibly a bi-directional...

Assessing the Impact of Tax Evasion on Long-Term Fiscal Imbalance: A Sensitivity Analysis Application

Lucia Mihóková, Radovan Dráb, Andrea Kralik

Prague Economic Papers 2018, 27(3):331-350 | DOI: 10.18267/j.pep.662  

Tax evasion can have important consequences for the macroeconomic and social balance of a country, as well as for its monetary and fiscal development. A limited number of studies dealing with the consequences for fiscal imbalance are present, but their objectives vary a lot. This analysis has been conducted with the purpose to empirically assess the impact of the tax evasion changes on the public debt in the 28 EU countries. The research considers the dynamics of public debt during the period of 21 years. The research is based on a probabilistic sensitivity analysis approach that was conducted individually for four clusters using @Risk of Palisade...

Macroeconomic Drivers of Non-Performing Loans: A Meta-Regression Analysis

Martin Macháček, Aleš Melecký, Monika Šulganová

Prague Economic Papers 2018, 27(3):351-374 | DOI: 10.18267/j.pep.656  

Common exposure to macroeconomic risk factors across financial institutions is a source of a systemic risk that influences quality of banks´ loan portfolios. This paper focuses on the growing literature on credit risk determinants. The aim of the paper is to provide more general information on effects of macroeconomic drivers with the use of quantitative meta-analytic techniques. We consider five of the most common macroeconomic determinants of non-performing loans ratio. The meta-regression results suggest that there are some significant differences among studies, which could be identified. For instance, data specification, estimation method, number...

Book reviews

All the Relevant Information on Foreign Direct Investment in One Book Publication

Ilya Bolotov

Prague Economic Papers 2018, 27(3):375-376 | DOI: 10.18267/j.pep.673