Central, Eastern And Southeastern Europe Research Articles

Cross-Country Linkages in Europe: A Global VAR Analysis

This paper uses the Global VAR (GVAR) model proposed by Pesaran et al. (2004) to study cross-country linkages among euro area countries, other advanced European countries (including the Nordics, the UK, etc.), and the Central, Eastern and Southeastern European (CESEE) countries. An innovative feature of the paper is the use of combined trade and financial weights (based on BIS reporting banks’ external position data) to capture the very close trade and financial ties of the CESEE countries with the advanced Europe countries. The results show strong co-movements in output growth and interest rates but weaker linkages bewteen inflation and real credit growth within Europe. While the euro area is the dominant source of economic influences, there are also interesting subregional linkages, e.g. between the Nordic and the Baltic countries, and a small but notable impact of CESEE countries on the rest of the Europe.

Cross-Country Linkages in Europe: A Global VAR Analysis

This paper uses the Global VAR (GVAR) model proposed by Pesaran et al. (2004) to study cross-country linkages among euro area countries, other advanced European countries (including the Nordics, the UK, etc.), and the Central, Eastern and Southeastern European (CESEE) countries. An innovative feature of the paper is the use of combined trade and financial weights (based on BIS reporting banks’ external position data) to capture the very close trade and financial ties of the CESEE countries with the advanced Europe countries. The results show strong co-movements in output growth and interest rates but weaker linkages bewteen inflation and real credit growth within Europe. While the euro area is the dominant source of economic influences, there are also interesting subregional linkages, e.g. between the Nordic and the Baltic countries, and a small but notable impact of CESEE countries on the rest of the Europe.

Editorial

In the years after the fall of communist governments in Central, Eastern, and Southeastern Europe (CESEE), a flood of memoir literature began to fill bookstores around the region. Some of these books were newly written, others had been composed long ago but could not be published during the socialist period. Alongside this rush of published work, historians and anthropologists began numerous oral history projects devoted to recording ordinary people’s experiences of state socialism. This need to narrate one’s own past and capture the memories of those who witnessed the tragedies of the twentieth century continues to the present day. The turn to autobiography and personal narrative inspired the theme section in this issue of Aspasia: women’s autobiographical writing and correspondence.

Competition and Inflation in Central, Eastern and Southeastern Europe: A Sectoral Analysis

Using the Amadeus firm-level database, this paper examines sector-specific competition in a number of Central, Eastern and Southeastern European (CESEE) countries and its impact on price developments. Using returns on assets as our preferred indicator for the intensity of competition across 20 industries in 11 CESEE countries over 1999–2007, we find evidence for a downward impact of more intense competition on inflation in a number of sectors that are of considerable importance for overall consumer price developments in these countries. This finding implies that at least in some sectors CESEE governments may be able to contribute to ‘taming’ inflation by ensuring a high level of competition.

The EUI Goes East: Perspectives for Research on Central, Eastern and South Eastern Europe

The paper examines the capacities for research on Central, Eastern and South Eastern Europe (CEE/SEE) at the EUI. It consists of two layers of inquiry. The first part presents the subject-field analysis of research related to the CEE/SEE that is currently undertaken at the EUI; the second part investigates the geographical coverage of the region at the EUI both in terms of researchers’ origin and geographical focus of their research. The paper concludes by offering recommendations on how to enhance the research on CEE/SEE using the existing potentials.

The Impact of the Global Economic and Financial Crisis on Central Eastern and Southeastern Europe (CESEE) and Latin America

This paper reviews the impact of the global economic and financial crisis on two distinct emerging market regions: Central, Eastern and Southeastern Europe (CESEE) and Latin America. Similar to other emerging economies, both regions were initially surprisingly resilient as the crisis gathered momentum. They were, however, both strongly affected by the sharp retrenchment in capital inflows and the collapse of global demand that followed the demise of Lehman Brothers in September 2008. Notwithstanding differences in the channels of transmission and the intensity of the propagation, the short-term outcome in 2009 was one of the deepest recessions in decades. As both regions differ in several important respects, the question arises how structural and institutional features as well as policies before and during the crisis have affected the transmission of global events to the two regions under review.

The Impact of the Global Economic and Financial Crisis on Central, Eastern and South-Eastern Europe: A Stock-Taking Exercise

The paper first reviews the main drivers of the growth and real convergence process in central, eastern and south-eastern Europe (CESEE) since 2000 and assesses the key macro-financial strengths and vulnerabilities of the region at the beginning of the global economic and financial crisis. The main part of the paper reviews financial and real economic developments in these countries since the crisis started to impact the CESEE region. The paper finds that developments have been rather heterogeneous in the region. CESEE countries with the largest economic imbalances tended to be most affected. National and international support measures appear to have helped to stabilise financial markets, and parent banks of foreign bank subsidiaries in CESEE were committed to sustaining their exposure to the region. The degree to which CESEE governments were able to use policy instruments to counter the real effects of the crisis is rather heterogeneous, depending inter alia on the exchange rate regime in place and the initial fiscal positions.

Foreign Banks in the CESE Countries: In for a Penny, in for a Pound?

The aim of this paper is to construct a comprehensive and consistent dataset to analyze the potential risks from foreign bank lending, for both the creditor and borrower countries of Central, Eastern and South-Eastern Europe (CESE). We develop a picture of bank claims on 13 CESE countries by combining credit statistics from several sources. Our constructed data suggest that some of these host countries have become more at risk from a sudden withdrawal of short-term external funding, while home countries have significant aggregate exposures to the region. Overall, we find that data on banking activity remain largely inadequate for surveillance and policymaking purposes, and that a concerted effort to improve data collection is needed at the international level.

Foreign Banks in the CESE Countries: In for a Penny, in for a Pound?

The aim of this paper is to construct a comprehensive and consistent dataset to analyze the potential risks from foreign bank lending, for both the creditor and borrower countries of Central, Eastern and South-Eastern Europe (CESE). We develop a picture of bank claims on 13 CESE countries by combining credit statistics from several sources. Our constructed data suggest that some of these host countries have become more at risk from a sudden withdrawal of short-term external funding, while home countries have significant aggregate exposures to the region. Overall, we find that data on banking activity remain largely inadequate for surveillance and policymaking purposes, and that a concerted effort to improve data collection is needed at the international level.