Central Eastern European Countries Research Articles

Reviewing Transition Economies (1989-2021): Sustainable Reform Outcomes in Post-Socialist Countries

The article is devoted to the assessment of the results of reforms in transition economies for 1989-2021 using cluster analysis. The article allocates 27 indicators characterizing the main parameters of the transformations of 25 post-socialist countries of CEE, SEE, Baltic, South East Asia, former CIS countries, etc. Using the methods of elbow, silhouette and gap analysis, the optimal number of clusters for transition countries is determined. The Ward method was used to cluster the transition countries into two groups and to draw a diagram with the boundaries of the clusters. The first group includes countries that are less successful in reforming, and the second group includes countries that have achieved significant results in reforming. Based on the analysis, conclusions and recommendations are drawn towards social entrepreneurship development as a driving force of social innovative dissemination. Keywords: results of post-socialist transformation in 1989-2021, cluster analysis, transition economies, social entrepreneurship development, public administration

Analysing the Impact of Entrepreneurship Education on Early-Stage Entrepreneurship—Focusing on the Transitional Countries of Central and Eastern Europe

Entrepreneurship is deeply rooted in tradition and culture in many countries; however, transitional market economies in Central and Eastern Europe (CEE) underwent 40–45 years of socialism, which disrupted these traditions by collectivising private property. Education is recognised as a key tool for regional development and restoring entrepreneurial knowledge and skills, potentially enhancing entrepreneurial intentions within society. This paper investigates the impact of entrepreneurial education on entrepreneurial activity in transitional CEE countries. Pearson’s correlation analysis was conducted using a combined national-level dataset from the Annual Population Survey (APS) and the National Expert Survey of the Global Entrepreneurship Monitor (GEM) spanning 2021–2023. Results reveal inconsistent findings across the years. In 2021 and 2022, there was a significant moderate correlation between total early-stage entrepreneurial activity (TEA) and an indicator of entrepreneurial education at primary and secondary levels in CEE countries. In contrast, no such relationship was observed in other regions. In 2023, however, no significant correlations were identified for any country group. These results highlight the temporal variability of education’s influence on entrepreneurship in transitional economies.

Multidimensional well-being and income inequality in Central and Eastern Europe: A comparative analysis of CEE North and CEE Continental countries.

Central Eastern European countries (CEEc) are characterized both by huge diversity in income inequality and, on average, by lower levels of well-being than in the other European Union (EU) countries. Given that income inequality may affect well-being negatively, the present study aims to explore the links between income inequalities and different dimensions of well-being in the eight CEEc, i.e. Poland, Czech Republic, Slovakia, Slovenia, Hungary, Latvia, Lithuania, and Estonia. The analysis is conducted in the two groups of CEEc regarding low and high inequality in income distribution, namely CEE Continental group and CEE North group (corresponding to post-socialist corporatist and post-socialist liberal, respectively). The multidimensional concept of well-being is applied, enabling deep exploration of its links with income inequalities in the following dimensions: subjective well-being (happiness) and objective well-being (material, health, educational, and environmental dimensions). We estimate the vector autoregression (VAR) models based on annual data disaggregated into quarterly data covering 2004 to 2020. The empirical results of Granger causality testing, which was used to investigate the links between income inequality and multidimensional well-being, indicated that not only are there differences between the groups in the studied patterns of interconnectedness, but also the groups of CEE North and CEE Continental countries are not homogeneous in those links.

OFFSHORING AND ITS IMPACT ON V4 LABOR MARKET: THE URGENT NEED FOR UPSKILLING AND COMPETENCE ADAPTATION

Over the past 20 years, production processes have become more fragmented, with various stages offshored to different locations, impacting international and domestic labor markets. CEE countries have become key offshoring destinations due to their skilled labor and competitive costs. This study aims to assess how shifts in international production affect labor markets in the V4 countries. We estimate a system of employment-share equations derived from a translog cost function, incorporating offshoring and domestic outsourcing, using the SUR method. Our findings suggest that offshoring negatively impacts employment for less-skilled occupations, while its effect on high-skilled jobs is insignificant. Thus, the need for continuous training and upskilling of the workforce to maintain competitiveness is highlighted by our findings.

RAZVOJ TRGOVINE IZMEĐU NR KINE I CIE : ANALIZA UTICAJA INICIJATIVE „16+1“

The development of trade relations between the PRC of China and the 16 countries of Central and Eastern Europe (CEE) from 2000-2022 are the subject of this research. Through the application of a gravity model, the factors that directly contribute to increased trade are examined, specifically examining the impact of CEE countries' participation in the “16+1” initiative. Empirical results show economic growth in the PRC and CEE, including CEE member-state status in the EU, has had a positive significant impact on developing bilateral trade between the PRC and CEE for all total trade (TT) (when viewed as dependent variables), as well as CEE imports to the PRC (IM) and CEE exports the PRC (EX). Participation in the "16+1" initiative is found to have contributed to increased trade only when CEE exports to the PRC were the dependent variable. However, when compared to EU membership, participation in “16+1” was found to be less significant.

Synchronization of Financial Cycles in Selected Central and Eastern European Countries

The COVID-19 pandemic had a strong economic impact, but its effects were felt also in the financial area. As a result of the economic recovery in 2021, there has been registered a significant growth of the lending activity in Central and Eastern European countries. This study illustrates that these increases have generated, for countries such as Hungary, the re-entry of the financial cycle in the expansion phase, having recorded positive deviations of credit from its long-term trend, situation which was not seen since the period before the last financial crisis. The results of the analysis also show that the financial cycle has a longer duration compared to the business cycle, as well as a higher amplitude. Thus, the turning points of the financial cycle are rarer, but they generate stronger effects than those of the business cycle. Regarding the synchronization of financial cycles at the level of the analyzed CEE countries, the results of this paper illustrate a strong correlation between the financial cycles of Romania, Bulgaria, and Hungary.

Geological storage of CO 2 in Hungary : the overview of storage potential and the role of natural occurrences

The Pannonian basin system, shared by seven Central-Eastern European countries, is one of the most perspective areas of onshore CO 2 geological storage in Europe. In the Hungarian part of the Pannonian basin system, the storage could be realized in depleted hydrocarbon reservoirs and saline aquifers comprising dominantly of Upper Miocene basin filling sediments. The estimated overall potential for CO 2 storage exceeds the 10 3 Mt in case of Hungarian part of the Pannonian basin system. The depleted hydrocarbon reservoirs correspond to this potential with limited, but well-defined capacities. However, saline aquifers represent large but indefinite capacities in the region. Furthermore, the accessibility of hydrocarbon fields is geographically limited in contrast to saline aquifers, which are regionally widespread in the Pannonian basin system. Structures that developed in the basin filling Late Miocene strata may also have been CO 2 rich or pure CO 2 -containing natural reservoirs. These natural laboratories represent a unique opportunity to study long-term processes taking place in the reservoir-CO 2 system and can be used to predict physical and chemical processes that are characteristic for the subsurface development during and after CO 2 injection in depleted hydrocarbon or saline aquifer reservoir.

China’s SDG cooperation and environmental strategies towards Central-Eastern Europe countries

The year of 2024 marked the twelfth anniversary of the cooperative mechanism between China and Central and Eastern European countries (China-CEEC). China has repeatedly affirmed its willingness to implement the 2030 Agenda for sustainable development and the sustainable development goals (SDGs), which created many opportunities to enhance the cooperation of the two sides. The paper exemplified some cases in the process of the cooperation, which were rarely discussed previously as normally it was dominated by the large-scale investment project. The cases of the climate change and ocean issues were perceived as a package of holistic EU-China relations that demonstrates the commitments from both sides to deal with SDG 13 and SDG 14. A qualitative method of the policy-circle evaluation and the goal-setting in the global governance was applied in the paper. The findings affirm that the current China-CEEC cooperation scheme is still carrying on both opportunities and challenges and affected by various internal and external factors.

How Beneficial is EU Membership for CEE Countries: an Attempt of Critical Analysis

Tectonic changes in the system of modern geo-economic relations necessitate the revision of many theoretical postulates. One of them is the unconditional benefit of participating in integration associations. The purpose of the study is to assess the real scale of benefits received by Central-Eastern European countries from participation in the EU. The study of the relatively long experience of membership of CentralEastern European countries in the EU allowed to formulate some conclusions, the most significant of which are: the excessive ideological and political argumentation used in Central-Eastern European countries in the initial period of decision-making on accession to the EU, which significantly reduced the effectiveness of the analysis of the economic consequences of the future membership; the significant methodological complexity of conducting a quantified analysis of the macroeconomic aspects of EU membership and, therefore, the difficulty of determining the quantifiable impact of the general effects of integration in relation to the countries of Central-Eastern Europe; the presence of overly optimistic assessments of the effectiveness of Central-Eastern European countries receiving transfers from the EU budget.

Step by Step—A Quarterly Evaluation of EU Commission's GDP Forecasts

ABSTRACTThe European Commission's growth forecasts play a crucial role in shaping policies and provide a benchmark for many (national) forecasters. The annual forecasts are built on quarterly estimates, which do not receive much attention and are hardly known. Therefore, this paper provides a comprehensive analysis of multiperiod ahead quarterly GDP growth forecasts for the European Union (EU), euro area, and several EU member states with respect to first‐release and current‐release data. Forecast revisions and forecast errors are analyzed, and the results show that the forecasts are not systematically biased. However, GDP forecasts for several member states tend to be overestimated at short‐time horizons. Furthermore, the final forecast revision in the current quarter is generally downward biased for almost all countries. Overall, the differences in mean forecast errors are minor when using real‐time data or pseudo–real‐time data and these differences do not significantly impact the overall assessment of the forecasts' quality. Additionally, the forecast performance varies across countries, with smaller countries and Central and Eastern European countries (CEECs) experiencing larger forecast errors. The paper provides evidence that there is still potential for improvement in forecasting techniques both for nowcasts but also forecasts up to eight quarters ahead. In the latter case, the performance of the mean forecast tends to be superior for many countries.

Paths (not) taken: promoting R&D in Central and Eastern Europe

ABSTRACT Central and East European countries are “dependent market economies,” aiming to escape the “middle income trap.” Developing R&D is one of the potential solutions to this challenge. Although overall the CEE countries are not considered exceptionally innovative, they still exhibit variation in terms of their R&D deliverables. Through fuzzy-set QCA, this paper aims to explain which combination of causal factors accounts for this variation. Innovation promotion in the region is tied to securing financial support, while the lack of R&D development is connected to both the absence of international financial resources as well as weak links between academia and business. Our results offer support to the idea that the hub of innovation within the CEE has remained the automotive sector connected to the German market. The paper stresses the necessity to explore the national coordination mechanisms of R&D promotion as some countries failed to deliver even in the presence of ample financial resources.

The Minimum Age of Criminal Responsibility Across Central Eastern European Countries

This article examines the legal frameworks for juvenile justice across Croatia, Serbia, Slovenia, Hungary, Slovakia, the Czech Republic, and Poland, focusing on the minimum age of criminal responsibility (MACR), juvenile offender categorization, and applicable legal measures. While these countries share a focus on rehabilitation and developmental considerations, significant differences exist in age thresholds and the treatment of young offenders. The MACR is an ongoing issue, shaped by legal, developmental, and societal factors. Two main trends emerge: one advocates for lowering the age and imposing stricter punishments, while the other emphasizes children's rights and rehabilitation. International standards, such as those from the Committee on the Rights of the Child, promote diversion programs to avoid stigmatization, yet no global consensus exists on the MACR. Pressure to lower the MACR, as seen in Hungary and Serbia, contrasts with neuroscientific findings that full maturity occurs in the third decade of life. A holistic approach integrating legal, psychological, and developmental perspectives is essential to balance accountability, rehabilitation, and the protection of children's rights in juvenile justice systems.

HPR82 Feasibility Study on the Possibilities for Implementation of National Screen Program for Lung Cancer in CEE Countries With Focus on the Balkan Region

HPR82 Feasibility Study on the Possibilities for Implementation of National Screen Program for Lung Cancer in CEE Countries With Focus on the Balkan Region

HPR132 Bridging the Gap: Should Health Policy Practices From Western Europe Influence CEE Countries?

HPR132 Bridging the Gap: Should Health Policy Practices From Western Europe Influence CEE Countries?

Distributive cycles in the export-led growth model: On the macroeconomics of a pro-labor shift in Central and Eastern Europe

Abstract This article aims to reassess a stylized fact, increasingly well-established in the Comparative Political Economy scholarship, that Central and Eastern Europe (CEE) economies exhibit characteristics of the so-called export-led growth (ELG) model. We can confirm the ‘ELG in CEE’ hypothesis by developing and testing a Goodwinian distributive cycles’ macroeconomic model focused on the productivity–employment–wage share nexus. Moreover, our approach allows us to shed light on the apparent contradiction between ELG characteristics and the dynamic wage and employment growth experienced in the region after the global financial crisis (GFC) by exploring the possibility of a productivity-induced shift within the ELG model. We conclude that CEE countries experienced technical upgrading, which allows them to maintain export competitiveness despite a visible pro-labor shift in the income distribution.

How can energy resilience be strengthened in Central and Eastern European states?

The energy crisis resulting from Russia’s military aggression in Ukraine in 2022 is seen by the European Union as an opportunity to accelerate the energy transition and strengthen energy resilience. Energy resilience is particularly important for Central and Eastern European (CEE) countries, which are highly dependent on imports of energy resources and which possess significant potential for the development of energy based on renewable sources. The article presents an analysis of the energy resilience of CEE countries in the context of the challenges related to the energy crisis, Russia’s war in Ukraine, and the EU’s ambitious climate goals. The aim of the analysis is to identify the factors that contribute to strengthening or weakening the energy resilience of these countries. The results of the study confirm the thesis that the process of strengthening the energy resilience of CEE countries is progressing, but too slowly and unevenly. The most serious problems for these countries are the increase in the share of energy from renewable sources, the modernisation and expansion of the old electricity grid, the lack of decentralisation of the energy system, and insufficient cross-border cooperation in the field of energy exchange. The findings can help to understand the political, technological and economic challenges faced by CEE countries in their energy systems.

Investigating the Influence of Gender Diversity and Management Practices on the Introduction of Innovation in CEE countries

The role of management in any organizational context is to identify and exploit positive influences and opportunities that lead to the achievement of business objectives and competitive advantage. Those involved in effective management should be able to define the factors that have a decisive influence on the innovative activity of the enterprise. The identification of these influences is a key source of knowledge for defining or adjusting corporate strategies, resulting in long-term benefits and effective business development. As the market is constantly evolving, businesses must adapt to it. In recent years, researchers and experts have paid considerable attention to the study of gender issues in various areas of management. Much of the existing research has shown a positive correlation between gender diversity and innovation in developed countries. However, empirical studies in transition or developing countries remain limited. Therefore, we focus on Central and Eastern European countries. Based on regression analysis of data from the large-scale WBES survey, the aim of the study is to identify the relationships between gender structure of management, management practices and innovation. Unlike previous studies, this study uses a management practices index that combines data from eight indicators of management practices and assesses how well they are structured. This study thus enriches the ongoing research on the impact of gender and the structure of management practices on innovation in the EU member states of Central and Eastern Europe. The contribution of this study lies in the analysis of several different types of gender diversity and a composite index of managerial practices in relation to firms' innovation performance, and the specific context of the analysis in Central and Eastern Europe countries may provide new insights, as different factors affect innovation performance in these countries than in their Western counterparts. The results of this research provide a deeper understanding of the dynamics between gender diversity in management and innovation, which could provide a basis for the development of policies and corporate strategies to promote diversity and innovation in the business environment of Central and Eastern Europe countries.

Defeating the Dark Sides of FinTech: A Regression-Based Analysis of Digitalization’s Role in Fostering Consumers’ Financial Inclusion in Central and Eastern Europe

Financial technologies metamorphose economies with customer-focused innovation. In this way, financial inclusion is fostered and economic growth is increased. However, risks, trust issues, and ethical concerns stem from the faster advancement of digital technologies and expanding financial innovation. Thus, this paper aims to understand the risks and barriers associated with FinTech and consumer adoption, focussing on the impact of digitalization on financial products/services’ acceptance. The research investigates the impact of digitalization on financial services and the recognition of the role played in the global economy by FinTech. For this reason, the regression analysis was used to explore the influence and correlation of various variables on FinTech in Central and Eastern European (CEE) countries, such as Internet usage, online shopping, paying bills via the Internet, and making and receiving digital payments. The results show differences between three clusters of CEEs in terms of FinTech adoption. While several past studies have explored the advantages of FinTech, few studies have investigated the risks associated with its adoption, trust, and barriers to its usage in different country contexts. The present paper fills the gap by analysing the data on Internet usage, online shopping, paying bills via Internet, and sending or receiving digital payments in CEE countries. The study recommends that FinTech companies share information online not only to present their offerings to users, but also to promote financial education through clear and straightforward communication about the features of their services. This approach can indirectly benefit society by contributing to financial development, inclusion, social stability, and, consequently, sustainable development.

How Does the Nexus Between Digitalization and Banking Performance Drive Digital Transformation in Central and Eastern European Countries?

The aim of this paper is to create a digitalization index for banking sectors using a set of indicators based on World Bank data for the period of 2010–2021, which will allow us to rank the sectors of Central and Eastern European countries (CEECs). The digitalization index is built based on how ready banks are for digitalization, the potential customers available for digital banking, and the level of digital infrastructure, with each of these aspects representing one pillar. Based on the calculation of the digitalization index, we emphasize that Romania is the leader, followed by Latvia and Lithuania, while Hungary and Estonia are at the opposite pole. Furthermore, we applied the fully modified ordinary least squares (FMOLS) method to measure the impact of digitalization on banking performance. This study reveals that Romania, Latvia, and Lithuania lead in digital banking transformation due to significant investments in infrastructure and customer engagement, while Hungary and Poland lag in terms of digital readiness. The results indicate that digitalization has a significant positive effect on banking performance (ROE), although countries experiencing market saturation had the potential to see a decline post-2018, necessitating further innovation to sustain growth. In the digitalization context, the results are relevant for policymakers, showing that investing more in digitalization is important and that there is a need to help people have greater access to banking services due to a lack of willingness and financial education, factors which prevent them from embracing digital changes. The results show that improving banking digitalization positively influences banking performances. This study provides an innovative and complex index for assessing banking digitalization in Central and Eastern Europe, with valuable implications for policymakers. We highlight the need to align digitalization policies with the specific level of digital development of each country in order to optimize the integration of digital technologies and enhance economic competitiveness.

Economic Cooperation and Development Strategies in New Energy Technology Between China and Central and Eastern European Countries in the 21st Century

Abstract: In the 21st century, the economic cooperation in new energy technologies between China and Central Eastern European countries is becoming more and more important. China, being the worlds largest energy consumer and a significant investor in sustainable energy, plays a pivotal role in this global transformation. This paper will study about the current state of this cooperation, existing challenges and opportunities. It will also talk about the development strategies for strengthening collaboration. The case study will be focused a successful program between China and Poland, highlighting the factors that contributed to its achievements. On the contrary, the failed project between China and Romania is also examined to understand the experiences and lessons. The paper aims to offer ideas and advices on improving economic and technological cooperation in the new energy sector. By highlighting the key experiences, fully showing the potential of the partnership between China and Central Eastern European countries in developing sustainable energy in the future.