Business Tendency Research Articles

Potential of business uncertainty indicators in forecasting economic activity: The case of Russia

This study investigates the utility of business uncertainty indicators as predictive tools for forecasting economic activity in the context of Russia. In an era characterized by global economic volatility and geopolitical shifts, understanding the dynamics of economic uncertainty and its impact on overall economic performance is of paramount importance. The study utilizes a comprehensive dataset based on the results of business tendency surveys in Russia, spanning the period from 2009 to the first half of 2024. Given the importance of uncertainty in shaping economic outcomes, the central research question of this study is: can uncertainty indicators predict business activity in Russia or not? To address this question, we compared two alternative approaches to calculating business uncertainty: the ex‑ante approach, which uses the business community’s assessments of future business trends to measure uncertainty as the dispersion of opinions expressed, and the ex‑post approach, which applies entrepreneurial assessments of both future and current trends to determine business uncertainty as the degree of deviation of entrepreneurial expectations from the real picture. National indicators and sectoral indicators were calculated for the mining and quarrying industry, manufacturing industry, construction, retail trade, wholesale trade and services. For most of the industries under consideration (except for the construction and service sector) and at the national level, the specifications of vector autoregression models that were effective for forecasting real indicators of economic activity, ­characterized by lower forecast ­errors compared to standard autoregressive models, were built. According to the results obtained, at the national level, when forecasting GDP, clear preference should be given to the ex‑post indicator.

강원특별자치도 무장애 관광 활성화 방안 연구

Purpose - Focusing on the FGI research method, the current status and issues of barrier-free tourism in Gangwon State were identified, and specific activation plans were derived Design/methodology/approach - This study conducted in-depth interviews with 20 experts related to the tourism industry. The issues, current status, and activation plan of barrier-free tourism in Gangwon State recognized by experts in tourism policy, tourism administration, tourism management, and tourism service industry were derived. Findings - First, the tendency of businesses to be promoted based on the non-disabled by not recognizing the weak as the main tourism demand group, second, confusion caused by the unification of terms related to barrier-free tourism, third, lack of finding tourism constraints subdivided according to the type and degree of disability, fourth, tourism information and evaluation indicators provided by prioritizing the convenience of suppliers rather than consumers, and fifth, the nature of the project focused on improving access to physical infrastructure. Subsequently, the results of the analysis of the plan to revitalize the barrier-free tourism industry in Gangwon State were as follows. First, education and programs to improve disability awareness appropriate to local conditions were activated, second, related information was unified and project sustainability was improved by creating a control tower for the barrier-free tourism industry at the provincial level, third, to overcome the employment crisis based on finding locally tailored jobs related to tourism care professionals, and fourth, to continuously secure quantitative and qualitative data and establish utilization plans. Research implications or Originality - First, it presents theoretical implications for related fields by providing issues and activation measures related to barrier-free tourism from the perspective of experts who are still lacking in research in academia. The practical implications are that based on the opinions of experts working in the tourism field, more specific issues of the barrier-free tourism industry in the province were presented, and policy and practical solutions were presented accordingly, suggesting realistic alternatives that can be carried out in the actual field.

New Indicators of Business Uncertainty in the Russian Economy

The purpose of the article is to present the main results of the study on the development of methods and testing of tools necessary for continuous monitoring of the business environment in Russia by measuring the level of its uncertainty and identifying the degree of its influence on the dynamics of economic activity based on the analysis of business tendency surveys. This methodology was tested for the first time to assess the level of uncertainty in the business environment and its impact on the digital and technological development of domestic industrial enterprises.The source of data for the study is regular sample surveys of business leaders for the period from 2009 to 2022. Two independent databases are used: quarterly surveys of business activity of organizations of various types of economic activity to build national and industry indicators of uncertainty in the business environment and annual pilot surveys of digital activity of industrial enterprises to construct an indicator of uncertainty in the field of digital and technological development of industry.All calculated composite indicators were able to identify significant features of the economic situation for the Russian economy associated with shock events. When analyzing the fluctuations of the indicators under study, «spikes» are clearly detected in response to the shocks of the business tendencies in 2020 and 2022. In general, the period from 2020 to the present is characterized as a period of prolonged crisis associated with growing uncertainty in the Russian economic environment, the unprecedented scale of which was demonstrated by the constructed indicators.According to the authors, the proposed composite indicators expand the analytical capabilities of business tendency surveys data, creating the prerequisites for regular monitoring of changes in the level of uncertainty in the business environment and increasing the operational value of the information provided by companies. This allows to develop more accurate socio-economic scenario forecasts.

Micro-Founded Output Gap Estimations with Business Tendency Survey Data

Micro-Founded Output Gap Estimations with Business Tendency Survey Data

Imputing Monthly Values for Quarterly Time Series: An Application Performed with Swiss Business Cycle Data

This paper compares algorithms to deal with the problem of missing values in higher frequency data. We refer to Swiss business tendency survey data at monthly and quarterly frequency. There is a wide range of imputation algorithms. To evaluate the different approaches, we apply them to series that are de facto monthly, from which we create quarterly data by deleting two out of three data points from each quarter. At the same time, the monthly series are ideal to deliver higher frequency information for multivariate imputation algorithms. With this set of indicators, we conduct imputations of monthly values, resorting to two univariate and four multivariate algorithms. We then run tests of forecasting accuracy by comparing the imputed monthly data with the actual values. Finally, we take a look at the congruence of an imputed monthly series from the quarterly survey question on firms’ capacity utilisation with other monthly data reflecting the Swiss business cycle. The results show that an algorithm based on the Chow and Lin approach, amended with a variable pre-selection procedure, delivers the most precise imputations, closely followed by the standard Chow-Lin algorithm and then multiple regression. The cubic spline and the EM algorithm do not prove useful.

Economic Growth Viewed from Life Expectation Levels, Wholesale Trade, Business Trend, Consumer Trends and Received of Zakat, Infaq and Alms

This research aims to identify and analyze the effect of life expectancy, wholesale price index, business tendency index, and consumer tendency index on economic growth with zakat, infaq and almsgiving receipts as intervening variables in Indonesia. The method used in this study is a quantitative method with the type of associative research, population and sample in this study is Indonesia's Economic Growth Quarter I 2005 – Second Quarter of 2022 Central Statistics Agency. Based on research on life expectancy, the wholesale price index, the business tendency index, and the consumer tendency index have a significant positive effect on economic growth in Indonesia. The results of this study indicate that the receipt of zakat, infaq, and alms has a significant positive effect on Indonesia's economic growth. It can be concluded that it can contribute to the government, zakat managers, the general public, both academics and economic actors and the general public so that they understand more about the linkage of life expectancy, wholesale price index, business tendency index, consumer tendency index to economic growth.

Dynamics of survey responses before and during the pandemic: entropy and dissimilarity measures app

This article is set within the framework of studies focusing on the impact of the SARS-CoV-2 virus on the dynamics of economic activity. For the purposes of the analysis of the expectations expressed in business tendency surveys, the paper aims to verify whether the pandemic of 2020-2022 can be seen as just another contraction phase. Entropy and dissimilarity measures are employed to study the characteristics of the expectations and assessments expressed in the business tendency survey of Polish manufacturing companies. The empirical results show that the dynamics of the manufacturing sector data, particularly as far as general economic conditions are concerned, set the pandemic period apart. The economic consequences of the COVID-19 pandemic expressed in business tendency surveys tend to be unfavourable, but the statistical properties or the degree of the concentration of respondents’ answers do not correspond closely either to the expansion or contraction phases of the business cycle.

Nowcasting the state of the Italian economy: The role of financial markets

AbstractThis paper compares several methods for constructing weekly nowcasts of recession probabilities in Italy, with a focus on the most recent period of the Covid‐19 pandemic. The common thread of these methods is that they use, in different ways, the information content provided by financial market data. In particular, a battery of probit models are estimated after extracting information from a large dataset of more than 130 financial market variables observed at a weekly frequency. The accuracy of these models is explored in a pseudo out‐of‐sample nowcasting exercise. The results demonstrate that nowcasts derived from probit models estimated on a large set of financial variables are, on average, more accurate than those delivered by standard probit models estimated on a single financial covariate, such as the slope of the yield curve. The proposed approach performs well even compared with probit models estimated on single time series of real economic activity variables, such as industrial production, business tendency survey data or composite PMI indicators. Overall, the financial indicators used in this paper can be easily updated as soon as new data become available on a weekly basis, thus providing reliable early estimates of the Italian business cycle.

Assessment of the economic activity in the Polish banking sector during the COVID-19 pandemic on the basis of business tendency surveys

One of the areas of the economy affected by the COVID-19 pandemic is the banking sector. The aim of the study presented in the article is to answer the questions: what was the perception of the economic situation in the banking sector in Poland during the crisis caused by the COVID-19 pandemic in the light of the results of business tendency surveys, and what determined its changes over time. The research was carried out on the basis of business tendency surveys conducted by Statistics Poland and Kantar Polska in the years 2004–2021. The conclusions were based on the trend-cycle component obtained by means of the X-13-ARIMA method. The analyses showed a negative relationship between the extent of the pandemic restrictions and the economic activity in banking, especially in the first phase of the crisis. Business tendency surveys show that during this crisis, the economic situation in the banking sector deteriorated more than during the financial crisis of 2008–2009. A relatively sharp decline as well as rapid rebounds were observed in the credit market, which caused its indicators to return in 2021 to the levels recorded before the outbreak of the pandemic. In the initial phase of the crisis, the economic downturn observed in the deposit market was not as sharp as in the credit market. On the other hand, however, the economic situation in the deposit market failed to improve significantly in 2021.

Development of the Methodology for the Business Tendency Measurement of Technological and Digital Activity in the Field of Greening of Industrial Enterprises in Russia

The objective of the article is to outline the current methodology and prepare development proposals to provide business tendency monitoring in terms of measuring the technological and digital activity of Russian manufacturing enterprises in the field of greening.The article covers the existing statistical toolkit and reflects key directions for improving (starting from 2018) the methodology under consideration. The authors show a specific empirical case through the presentation of the obtained monitoring results. At the same time, the main indicators used to assess progress in the field of green technologies and the environmental friendliness of organizations in international practice are given. The analysis was based on quantified data from annual business tendency surveys of digital activity of Russian manufacturing enterprises for 2019–2020, including a set of indicators characterizing technological and digital activity in the field of greening and increasing resource efficiency.The results obtained indicate that despite the small scale of the current use of digital tools that contribute to the effective achievement of environmental goals and objectives in the ecological and economic production system in 2020, there was an active spread of activity in this area compared to 2019. In particular, the recorded trends were traced within the framework of measures aimed at improving energy efficiency, efficiency of water use and raw materials, as well as waste disposal. In addition, monitoring showed that respondents from most sub-sectors in 2020 expected the emerging positive trends to strengthen in the short term in all major areas of the green agenda.The trends identified and outlined in the study indicate that for Russia, expanding the depth and coverage of statistical observations of the process of greening industries, including with the help of business tendency observation apparatus, is an urgent task that requires constant improvement of methodological support in terms of the tools used and data analysis, as well as construction of new meters, including the corresponding composite indicators.

Meta Analysis: Relating to Entrepreneurship and Business Tendencies

In general, the meta-analysis method is of fundamental importance for obtaining an unbiased assessment of the evidence that is sought. In general, the use of meta-analysis has increased over the past three decades as a major research topic, and, subsequently, it is very useful for understanding its methods and interpreting its results. Thus, with a clearer understanding of this method, it can explain the appropriate writing method according to the rules or requirements. The researcher will also use statistical software in the market accompanied by examples of work taken from related studies on meta-analysis as a reference.

Digital Marketing and Business

Digital technologies have led to significant transformations in economic activity. One such area is marketing that is an important part of any business. The main trend in the digital economy is the abundance of information. The application of Internet technological advancement activities in marketing gives the possibility to customer feedback as well as helps to raise awareness of the company's products while promoting their products. The application of Internet technological advances in the modern conditions of marketing activities allows firms to reduce marketing costs, to expand the customer base, to increase the effectiveness of advertising activities and, most importantly, to find the target audience. In the article are considered the problems of implementation of digital marketing means by business in Georgia. There is explained the essence of digital marketing, is analyzed its singularities from internet marketing. Additionally, there are determined the tasks of marketing activity of small and medium enterprises in digital environment. In the article there are stated the basic tendencies of digital marketing development. Keywords: digital marketing, small and medium business, internet marketing, information field, digital marketing tools, business tendencies.

Fuzzy-based non-bankruptcy trend forecast

Many companies face an economic downturn due to the Covid-19 pandemic outbreak, which makes their future uncertain. The practical aim of the paper is to establish a procedure for an effective prediction of a business tendency to bankrupt in the short-term period. The tool is a three-stage fuzzy model formulated in the theoreticalmethodological part and applied on the real data of an examined company. The model input parameters are objective and subjective measured data between 2008-2020 of a nature affecting the output. The output is an interval of subjectively expected values determining the non-Bankruptcy trend (non-B) of a company. The paper shows advantages of the interval fuzzy approach for bankruptcy prediction and identifies the measure of business safety.

BUSINESS SIMULATION AS KEY MOTIVATION FACTOR IN STIMULATING BUSINESS INTENTION AMONGST UNIVERSITY STUDENTS IN MALAYSIA

The importance to raise up the number of entrepreneurs among the younger generation, especially among the university’s students has been recognized by the Government. This study seeks to link the effectiveness of business simulation with entrepreneurship interest of the students in University Utara Malaysia, main campus, Sintok. Four main objectives of the study were highlighted which is to see the relationship of perception, learning, interest and satisfaction of the business simulation on the tendency of students to venture into the business environment. The fifth objective is the combination of perception, learning, interest and satisfaction from business simulations of their entrepreneurial tendencies. The findings show that there is a significant relationship between learning, interest, satisfaction and the combination of all dimensions-dimensions of the business tendency. The findings from this study particularly useful to certain parties in the field of education and also to entrepreneurial developers.

Features of the Formation of Technological Expectations in Russia: Analysis of the Results of Business Tendency Surveys of Digital Transformation of Manufacturing Enterprises

The purpose of the article is to analyze the technological expectations of managers of Russian enterprises from the manufacturing industry in the face of changes in the external economic environment. Firstly, the authors have calculated a specially developed «index of fulfillment» of technological expectations, reflecting the ratio of the expectations of the introduction of digital technologies formed in the previous period and an increase in the real level of implementation. Secondly, using regression analysis, the authors investigated the mechanisms of the formation of technological expectations of managers in various conditions: non-crisis 2018, pre-crisis 2019, and crisis 2020. The influence of the three mechanisms was tested in intertemporal context: the «inertial» one, which presupposes the preservation of the expectations formed in the past in the current period; «adaptive» which involves adjusting expectations in accordance with the current dynamics of technology implementation; «predictive» which implies the connection of expectations with the future level of implementation.The basis for empirical calculations was the data of annual business tendency surveys of digital activity of Russian manufacturing enterprises for 2018–2020. The aggregate sample of surveyed enterprises for three years included more than 3000 enterprises from 23 manufacturing industries. The paper studied patterns of implementation of 19 digital technologies, most of which, according to specialists, belong to Industry 4.0.The results obtained indicate that technological expectations are characterized by great heterogeneity in terms of feasibility. Regression analysis showed that all three identified mechanisms can play a role, but their influence varies. In particular, when a crisis occurs, the adaptive mechanism plays a key role, and the inertial mechanism becomes irrelevant.The results of this study indicate that Russia is characterized by the initial and transitional nature of digital transformation in the manufacturing industry, with technological development achieved through «breakthroughs» rather than a steady process of modernization. The main conclusion of the work is that external uncertainty greatly affects the evolution of technological expectations, destroying their continuity from previous plans and negatively affecting the predictive capabilities.

Is it me or you? A deeper insight into profile of misreporting economies

Trade misinvoicing has been used as one of the measures of illicit capital flows. However, estimates are likely to be biased due to the common assumption of no misinvoicing on the part of developed countries, and insufficient treatment of transportation and insurance costs. In this paper we address both of these issues by estimating the extent of trade misinvoicing that depends on particular combination of traits of exporting and importing country. Given our results, incentives to misreport tend to be stronger when goods are shipped from low- to high-income country or among the poor peers. The relatively new tendency for multinational businesses to engage in tax base erosion might be reflected in our second important finding, i.e. that combination of high-tax exporter and low-tax importer implies underinvoicing on the side of exporter and/or overinvoicing on the side of importer. Thirdly, level of financial development seems to play a decisive role, especially when connecting the receivers of capital on exporter's side and financially repressed economies on importer's side.

Business resilience best practices that do not work: Cautions and guidance

Across the world, there is an increasing tendency for businesses to rely on best practices, based on the assumption that they provide proven, credible and efficient solutions. In-depth scrutiny of ‘best practicism’, however, paints a different picture of its effectiveness; indeed, the adoption of best practices is commonly ineffective due to their misapplication or the use of unsupported assumptions. This article explores the use of best practices in the business resilience profession and describes reasons why assumptions about them are often incorrect. Cautions about best practices focus on the importance of change processes, underestimating problem complexity, and the influence of confirmation bias. These factors, and ways to address them, are described in the context of business resilience.

Business Uncertainty during the Covid-19 Pandemic: Assessment Based on the Pandemic Fear Index and Economic Surveys

Purpose: The article presents an assessment of the situation of business enterprises during the COVID-19 pandemic. Design/Methodology/Approach: The analysis uses the Pandemic Fear Index (PFI) and more detailed analyses based on Business Tendency Surveys (BTS). The proposed PFI considers critical factors in a pandemic, such as reported cases of illness and death and government actions that restrict business operations. Findings: The study indicates a clear differentiation of the situation among businesses depending on the nature of the business activity. The changes in the PFI index turned out to be like the changes observed in the BTS in individual sectors of the economy. An exceptionally high correlation was found between the indicator and the results of the “pandemic module” of the BTS. Practical Implications: The analysis uses data from the Polish economy, but the proposed methodology of identifying and assessing the impact of a pandemic on the economy may be used in other countries, depending on data availability. A broader application of the presented approaches considering pandemic shock may be one of the directions for further research in the future. Originality/Value: The PFI, specially designed for the pandemic period, is a proxy for assessing business uncertainty during a pandemic. The advantage of the indicator is the ability to observe the daily changes of its value along with any incoming information. The added value of applying the proposed methods is the possibility of a detailed analysis of the occurrence of subsequent pandemic waves and the emerging discrepancies in the shaping of uncertainties that appear during the pandemic in individual sectors of the economy.

Information Support for the Statistical Assessment of Labor Market Demand in Ukraine

The statistical assessment of labor market demand has to focus on qualitative rather than quantitative characteristics of jobs from the perspective of opportunities for choice and development of employed. Such assessment of jobs requires information and technical support. A review of the available information sources on the number and structure of jobs lays the ground for constructing a comprehensive assessment methodology on the basis of official statistical observations supplemented by administrative data on vacancies. It is shown that each source has its strong and weak sides. The strong sides of official sources are systemic professional approach and standardized techniques for data collection and processing, regularity, data quality control and accountability. But these sources still remain hardly accessible for research purposes, their data are compiled by the formal and sectoral approach and published in highly aggregated form. Alternative sources, including independent analytical and marketing studies, online databases of vacancies, are displayed in open access and contain detailed vacancy descriptions. But these data are unstructured, fragmented and need careful treatment due to a high probability of the system bias caused by broad applications of marketing strategies.
 The comprehensive assessment of labor market demand should be based on the results of Labor Force Survey, which enable for simultaneous structuring of indicators by social-demographic characteristics of respondents and organizational-economic characteristics of production units. Data from this survey have to be supplemented by data from enterprise surveys on labor statistics, labor conditions and business tendencies, anonymous data from the registers of the Pension Fund of Ukraine, and by data on vacancies available in the databases of the State Employment Service and private recruitment companies.

Development of Composite Indicators of Cyclical Response in Business Surveys

The article proposes a new set of composite indicators-predictors in business tendency surveys, which allow identifying early information signals of a cyclical nature in the economic behavior of business agents. The main criterion for the efficiency of such indicators is their sensitivity to a cyclical pattern and changes in the dynamics of statistical referents. Property such as a statistically significant lead in time series or earlier publication allows them to be combined into indicators of early response. The composite Business Activity Indicator (BAI) in the basic sectors of the Russian economy is calculated by the authors for the first time based on the results of regular (monthly and quarterly) business surveys of Rosstat for 1998–2020 with a large-scale coverage of sampling units. In 2020, the number of survey respondents averaged about 20,000 organizations of all sizes. The index reflects the «common» profile in the dynamics of short-term fluctuations of the key parameters of the economic environment, which consists of the «balances of opinions» of respondents to the questions unified for all sectoral surveys and connected with the reference quantitative statistics with cross-correlation coefficients that are statistically significantly different from zero, with a lead at least one quarter. This is its main difference from the well-known indices of economic sentiment and entrepreneurial confidence. The main components of the BAI are the new composite indices of real demand, current output, real employment, total profits and economic situation. They aggregate the relevant «order» statistics for the basic sectors of the national economy, including the main kinds of industrial activities, retail trade, construction, and services.The article provides a methodological substantiation and an extended procedure for identifying the BAI components; their composition is formed for the entire set of retrospective results of business tendency monitoring in Russia. A new Aggregate Economic Vulnerability Indicator with a counterdirectional profile and varying degrees of symmetry of its dynamics relative to the short-term movement of the BAI is being introduced as the main limitation of business activity. Proactive monitoring of emerging vulnerabilities in the business environment is necessary to warn their large-scale accumulation, prevent the risks of economic downturns and ensure the highest possible macroeconomic stability. This integrated approach makes it possible to determine the novelty of the proposed measurements of short-term cyclical fluctuations in economic development.