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Economics and business journals focus on publishing papers coming from the fields of applied economics, corporate finance, financial investments, markets, institutions, industrial organization, international trade, marketing and similar.
Business and Economics
Abstract
Digitalisation presents a significant challenge for small- and medium-sized enterprises (SMEs), as they generally lack the required competencies and qualifications for a digital transformation. However, crises such as the COVID-19 pandemic have highlighted how digitalisation can improve SME efficiency and unlock new markets. This paper aims to contribute to the empirical literature by analysing the factors influencing Hungarian entrepreneurs' activities and attitudes towards digitalisation during the COVID-19 pandemic. The results are based on the quantitative analyses of Hungarian datasets of the Global Entrepreneurship Monitor (GEM) spanning 2021 to 2023, complemented by figures from a representative survey of SMEs in 2022. Our findings show that while nearly all SMEs utilise digital devices, adopting more advanced solutions remains low. Although the pandemic somewhat accelerated the digitalisation efforts, most entrepreneurs do not expect to use more digital solutions in the next six months. There is no consistent correlation between digitalisation and entrepreneurial motives, as the cluster analyses did not provide homogenous groups of entrepreneurs in the years analysed, so we can conclude that digitalisation efforts may be even among them. Thus, to overcome the challenge of digitalisation, policymakers should incentivise entrepreneurs to improve their digital skills and implement digital solutions.
Abstract
The paper analyses the Loss Given Default (LGD) rates of residential mortgages, using a model based on stochastic collateral value. The implementation of the model is based on exponential Ornstein-Uhlenbeck processes fitted to the Hungarian regions' house price indices. According to the model results, in case of a mortgage with a 80% loan-to-value ratio at origination, the expected LGD is around 30–40%, depending on the region. The highest LGD rates are estimated for villages, while the lowest rates are expected in Budapest and cities in the middle of the country. The range of the regional differences can reach 7 percentage points. According to the LGD Risk index based on the aggregated model, the LGD risk profile of recently issued mortgages has improved significantly since 2009 in Hungary.
Due to the strong negative relation between the house prices and mortgage default rates, the expected return on defaulted collateral value tends to be low. The results could be relevant for credit institutions in their mortgage origination decisions and enhance analysis of lending processes and the associated risks.
Abstract
This contribution aims to address the intriguing issue of whether Industry 4.0, as a techno-economic paradigm shifter, may have a greater potential for exaptation (i.e., using it not for pursuing of quantitative but that of qualitative development) and, if so, what technologies may accelerate this process. Existing research indicates that graphene technology has the potential to lead the way in this area. The paper addresses not only why and how a graphene-aided Industry 4.0 can be conducive to this function (i.e., making exaptations easier on a larger scale), it examines the wider context for exaptations by questioning whether the current setup of the real economy, the financial universe, and the public sector offers a supportive environment for exaptations.
Abstract
This research developed an analytical framework for industry-oriented leading cyclical indicators (CII), focusing on monitoring and forecasting economic cycles within the European Union (EU). Various methodologies for constructing these indicators were examined through an exhaustive sector analysis. A salient conclusion drawn is the non-feasibility of a one-size-fits-all composite leading indicator for all EU members. It underscores the imperative to tailor these indicators in congruence with the unique industrial characteristics of each country. The study provides empirical evidence that countries like Denmark, Germany, Austria, Estonia, Lithuania, Latvia, Finland and Sweden can benefit from high-caliber composite leading indicators tailored to their economies. Our analysis suggests that GDP is a more robust metric than the Industrial Production Index for predicting economic cycles for the EU countries.
Abstract
This study examines the complexity in the Eastern European economies, with a focus on the role of foreign direct investment (FDI). Despite transitioning to market economies, these countries remain economically fragile and dependent. Their lower technological complexity and reliance on foreign capacity make them vulnerable. However, some countries like Austria and Poland demonstrate successful integration of production and innovation. The analysis shows FDI has a limited impact on developing complex knowledge but contributes positively to economic complexity. Results also indicate that in the long-term, economic and technological complexity does not lead to accelerated total factor productivity growth, contrary to complexity literature. Combining labour with innovation, safeguarding local industries, and prioritizing education and research are more effective approaches. The study clearly shows how Hungary is stuck in an “assembler trap.” It also finds that the gap between economic and technological complexity negatively affects liberal democracies.
Abstract
This paper investigates the use of redundancy procedures (RPs) by small and medium-sized enterprises (SMEs) in Spain during the COVID-19 pandemic. The novelty of this study is that it goes beyond the direct influence of the determinants of RPs on RP use, and analyses how the interactions among them moderate the direct effect. In contexts of rising uncertainty, businesses need to adapt their operations and fixed costs, including staffing. While teleworking is an alternative to RPs, our results show that it was not enough to deal with the negative impact of a worsening crisis. Moreover, when the survival of the business is at stake, the use of RPs increases further when the company is simultaneously affected by changes in demand and liquidity issues. We argue that our results reveal the need for flexible tools along with the policies that take into account the fact that businesses' reactions are contingent on their exposure to risk.
Abstract
The dividend puzzle for private corporations has a long-lasting history. Six theories provide explanations to this puzzle. However, the dividend puzzle has not yet been discussed as an economic problem for state-owned enterprises (SOEs). The article addresses this issue based mainly on the experience of the Bulgarian SOEs.
In the paper all well-known six theoretical concepts of the dividend puzzle are presented and their strengths and weaknesses are analysed. Furthermore, the specific features of SOEs are brought out and the dividend puzzle for them is formulated. Presenting the experience of the dividend policy of SOEs, a confrontation with the theories is made. It is proved that only the theory of dividend payment preference is relevant to SOEs.
Abstract
This research investigates the causal relationship between innovation, financial development and economic growth in Brazil, Chile, Colombia, Mexico and Peru between 2000 and 2019. Based on quantitative analysis, including vector autoregressive (VAR) models, it can be concluded that bidirectional Granger-causalities are present in the trivariate nexus in the five Latin American countries over the investigated times. Consequently, the three variables support forecasting and policy implications focusing on one of the three sectors that impacts the other two in the future. The paper concludes that imitation and innovation policies focusing on intellectual property rights protection, education, knowledge, institutional change and technological catch-up are necessary to foster economic growth and financial development.
Abstract
This study aims to analyse the time series properties of the unemployment rates in 10 Central and Eastern European countries after joining the European Union. Three types of unit root tests were conducted: (1) linear unit root tests, namely ADF, PP, LM, and RALS-LM tests; (2) LM and RALS-LM unit root tests with two structural breaks; and (3) LM and RALS-LM unit root tests with Fourier function. The results reveal that the hysteresis hypothesis is valid for Bulgaria, Czechia, Hungary, Latvia, Lithuania, Romania and Slovenia, whereas the structuralist hypothesis is valid for Estonia and Poland. However, the natural rate hypothesis holds only for Slovakia.
Abstract
This paper provides a comprehensive assessment of the total (market and non-market) gender-based production and consumption activities of Turkish men and women at different stages of their life-cycle. Turkey, one of the few emerging economies within the OECD, offers an interesting case-study as its female labour force participation rate is one of the lowest among OECD countries. Our results show that time spent by Turkish women on household activities is, on average, 30 h a week, basically three times as much as men. In fact, the women-to-men time use ratio for unpaid work is roughly twice as much as the OECD average. We estimate that the monetary value of women unpaid household production exceeds 29% of GDP, while the corresponding estimate for men is around 8%. Using the concept of life-cycle deficit, we also show that Turkish men are dependent on housework undertaken by women over their entire lifetime, which is an almost unique feature in comparison to the European and OECD countries. Finally, unlike other OECD countries that have introduced disincentives to early retirement, Turkish men continue to retire early but retain their acquired habits of not sharing the burden of household work.
