European Union Economy Research Articles

თანამედროვე ტექნოლოგიების როლი ევროპის მწვანე შეთანხმების სტრატეგიის განხორციელებაში

The European Green Deal is an attempt to transform the European Union's economy in order to achieve climate neutrality by 2050. This is to counteract undesirable climate change and environmental degradation. In this context, an interesting question is the role of new technologies in the implementation of the European Green Deal. In order to be able to answer this research question, this study is divided into few parts. The first one is an introduction to the analysed issues. The second part presents the basic assumptions of the European Green Deal. The third part presents how new technologies can help in the implementation of European Green Deal strategy. The study ends with a summary containing the conclusions of the conducted research.

Britain and BrExit: Is the UK more attractive to supervisors? An analysis of the wage premium to supervision across the EU

AbstractWe studied which European Union (EU) economy was more attractive prior to Brexit for employees in supervisory positions. We estimate the extra wage that supervisors earn relative to their subordinates—the wage premium to supervision (WPS)—at different quantiles of distribution of wages for 26 European economies. We find that the UK rewards supervisors more than other EU economies. Moreover, the WPS increases with wage and so increases wage inequality. Over 10% of the WPS depends on the national economic context. We discuss the implications for immigration and policymakers in relation to the post‐Brexit process.

Which Determinants Matter for Working Capital Management in Energy Industry? The Case of European Union Economy

The main purpose of the paper is to identify firm,- industry- and country-specific determinants of working capital management (WCM) in energy industry. The empirical research is based on 6122 EU companies operating in the years 2011–2018. The influence of internal factors on variables describing WCM (cash conversion cycle—CCC, financial liquidity—LIQ and level of working capital—WC) were identified. The factors included: size of the company (positive effect), its growth, tangibility and indebtedness (negative effect). Cash flow had a positive effect on CCC and a negative effect on LIQ and WC. The influence of industry-specific factors were also found. Companies applied similar strategies in CCC and LIQ management, following their industry averages. Measures of WCM decreased under the influence of an increase in average trade payables in the industry. Following country-specific factors were found to be significant: (i) growth of GDP and strength of legal rights had negative influence on all measures of WCM, (ii) unemployment positively affects LIQ and WC and negatively CCC, (iii) an increase in the share of renewable energy sources caused a decrease in all WCM measures, while (iv) with an increase in energy consumption, CCC and WC increased.

EFFECTS OF CORONAVIRUS PANDEMIC ON STOCK MARKETS IN THE EUROPEAN UNION

The world is undergoing one of the biggest economic crises since the 1929 Great Depression with the coronavirus pandemic. The emergence of the COVID pandemic, before the effects of the 2008 global economic crisis have not evaded, triggered the dynamics of the economic crisis again. The European Union (EU) economy is also deeply affected by the crisis. This paper explores the relationship between the number of coronavirus disease 2019 (COVID-19) cases and Europe's most important stock market indices by using time series analysis. While performing the analysis, three different models were created. In this context, the number of cases of COVID-19 has been used as independent variables, while DAX Index, CAC 40 Index, and Euronext 100 Index have been tested as dependent variables, respectively. The analysis results prove that there is a long-run cointegration relationship between variables. We also found that the Error Correction Model results are statistically significant. Consequently, the results of the estimator determine that the COVID-19 negatively affected the European stock markets.

Boron recovery from desalination seawater brines by selective ion exchange resins

The European Union (EU) depends on third markets to supply many important raw materials. Increasing the circularity of critical raw materials within the EU is important not only from an environmental perspective, but also as a competitive advantage for the EU economy. In the case of boron, the EU's import dependency is about 100%. This work aims to evaluate the boron recovery from seawater desalination plants (SWDP) brines using ion-exchange resins in a circular economy approach. Commercial boron selective resins Purolite S108, DIAION CRB03 and CRB05 were tested and compared on batch and dynamic experiments. Thermodynamic and kinetic experiments were performed, and results were fitted by linear and non-linear models. After a comparison, results showed a good fit to the Langmuir isotherm and the pseudo-second order model, respectively, for all the commercial resins tested. The DIAION CRB03 resin presented higher sorption capacity and percentage of boron sorbed than the other resins and was selected as the best option for boron recovery from SWDP brine. Dynamic experiments in fixed bed column using DIAION CRB03 resulted in a sorption capacity of 13 mg/g of resin, a boron recovery of 98% and a concentration factor of 30, for an initial boron concentration of 50 mg/L. In addition, an economic analysis was carried out as a preliminary estimate of the revenues obtained from the production of boric acid from the brine produced by El Prat desalination plant.

Impact of Foreign Direct Investment on Tax Revenue: The Case of the European Union

Foreign direct investment (FDI) is an extremely important factor that promotes national competitiveness and economic development through technology transfer, new management skills, foreign trade, corporate productivity, etc. This study aims to analyze the significance of FDI and its impact on tax revenue and competitiveness, focusing on the European Union (EU) economy. An empirical analysis is conducted to determine the relationship between inward and outward FDI and tax revenue by employing data on EU countries between 1999 and 2019. The data were extracted from the United Nations Conference for Trade and Development (UNCTAD) database and the World Development Indicators database (WDI) of the World Bank. To fulfill the objective of this study and to determine the effect of FDI on tax revenue, an econometric model was developed. The research methods include systematic and comparative analysis of scientific literature, panel data analysis, and multiple regression analysis. The regression analysis was based on the least-squares method, and the estimates of the econometric models were calculated by identifying robust heteroscedasticity-consistent standard errors. The study results reveal that the outward FDI has a significant stimulating impact on total tax revenue. In contrast, inward FDI has a dampening effect on tax revenue. The analysis of the lagging effect of FDI on tax revenue in the EU member states revealed a statistically significant lagging impact of the outward FDI made two years before. The estimations indicate that the lagging effect is an incentive. No statistically significant lagging effect of the inward FDI flows on tax revenue was found.

A Comparative Analysis of Competitive Trade in a Cluster Market of the European Union: The Revealed Comparative Advantage (RCA) Index

Abstract This research is concerned with the comparative analysis of competitive trade within the cluster market economies of the European Union. The aim of this paper is to carry out trade analysis within the competing countries in the European market from 2009 to 2018 which represents the period after the global crisis of 2008 and prior to the Covid-19 pandemic of 2019 for the purpose of determining the extent of competitive trade within the European economies. The chosen metric is Béla Balassa’s Revealed Comparative Advantage (RCA) index used for determining various countries’ comparative advantage or disadvantage in trade. The findings show that the countries with RCA > 1 thrive economically in comparison to other competing lower economies. And the fact that the European Union economy thrives on mechanized trade other than agricultural products irrespective of the competitive market. This study is a significant contribution towards improving the Ricardian model of comparative advantage on trade within a cluster market in the European economies.

European Green Deal

This article aims to present the main objectives and characteristics of the European Green Deal, which is a kind of roadmap for achieving the sustainability of the EU economy by turning climate and environmental challenges into opportunities in all policy areas, through a just and inclusive transition for all. The implementation of this roadmap provides for actions to use resources efficiently by moving to a circular economy, reducing biodiversity loss and diminishing pollution. The roadmap also sets out the necessary investments and financial instruments and the need to ensure a just and inclusive transition. Transforming the economy of the European Union (EU) into a resource-efficient economy in which economic growth is not directly linked to the use of resources, based on the cessation of net emissions by 2050. The European Green Deal outlines a plan for this transformative change.

The Dynamics of the European Union Regional Policy

The subject of this paper is to present the shape, the legal basis and the prospects for the development of the European Union regional policy. This policy assumes great importance in the face of weakening of state’s structures due to the European Union bodies and decentralization of management of local affairs. The EU regional policy is a very problematic area and requires extensive studies. Thus, I confined myself to analyze the development of basis of the EU regional policy primarily through the prism of treaty law. The analysis showed a rate of development which process still continues. Despite a good legal basis, the EU regional policy still requires constant adjustment, especially when it comes to rationalizing subsidies. The passive regional policy leads to promote only the economically under developed areas. Therefore, it is necessary for the implementation of programs to support the innovation, especially in highly developed regions, which are the engine of the whole European Union economy.

ДОСВІД ІНВЕСТИЦІЙНОГО ЗАБЕЗПЕЧЕННЯ МОДЕРНІЗАЦІЇ ЕКОНОМІКИ КРАЇН СХІДНОЇ ЄВРОПИ

The study used general scientific methods of analysis and generalization to formalize the scientific and conceptual apparatus, determine approaches and patterns of investment support for economic modernization; statistical analysis - to establish the dynamism and direction of investment support; graphical visualization - to present and summarize the results of the study. The obtained results allowed to formalize the goals of economic modernization of Eastern European countries and models of their implementation. The authors identified two key ways of modernization: through integration into the European economic space and regional investment support. On the example of the modernization of the infrastructure sphere of Poland, Romania and Slovakia, the applied aspects, models, patterns and experience of implementing the goals of investment support are shown. The practical significance of studying the experience of investment support for the modernization of the European Union's economy is to formalize the imperatives, to formulate strategic guidelines, to develop models and mechanisms for modernizing the economy of Ukraine, especially in the context of scientific problems of recovery and European integration.

The European Green Deal and the social market economy

The European Green Deal is an attempt to transform the European Union's economy in order to achieve climate neutrality by 2050. This is to counteract undesirable climate change and environmental degradation. In this context, an interesting question is whether the implementation of the European Green Deal is in line with the European Union's model of the Social Market Economy. In order to be able to answer this research question, this study is divided into five parts. The first is an introduction to the analysed issues. The second part presents the basic assumptions of the European Green Deal. The third presents the most important assumptions of the Social Market Economy in the context of climate policy. The fourth part analyses the coherence of the European Green Deal with the model of the Social Market Economy. The study ends with a summary containing the conclusions of the conducted research.

THE EUROPEAN GREEN DEAL AND THE FORESTS IN THE WORLD

The Green Pact of the European Union is part of the United Nations' programme of sustainable development to 2030. To implement this pact, it is necessary to transform the European Union's economy with a view to protect and restore endangered and damaged natural ecosystems, sustainably use resources, and improve people's health status. For this purpose, it has been envisaged to stabilize climate by reducing the emissions of greenhouse gases by 55% up to 2030, as compared with their levels of 1990. Changes are necessary in emission trade, land use and forestry. Forests are particularly important for realizing the Green Pact because of their multi-functionality. The following, most general inferences can be made about the world forests intended to perform their resource-providing, environmental and social functions: - The world area of forests has continued diminishing in the recent 10 years by 4.7 million ha per year as an average as the rate of forest loss has been abating due to the expansion of the forests in Asia and Europe. The deforestation for the period from 2015 to 2020 occurred at the rate of 2 million ha per year with a trend as to abatement. - The forests in Africa are the most vulnerable ones, in terms of their area, as their reduction already surpasses that in South America. The deforestation in South America from 2010 to 2020 decreased to the half of that in the period 1990-2000 and 2000-2010. - Sustainable forest management requires contemporary forest-management planning and forestry but, only for half of their total area there are forest-management plans. This planning activity has been carried out almost completely in Europe only, whereas its proportions in terms of forest area are 2/3 – in Asia, 1/2 – in North and Central America, and only 1/3 – in Oceania, 1/4 – in Africa and 1/6 – in South America. Without total forest-management planning, it is impossible to realize the multi-functional, sustainable management of forests. - The proportions of forests for harvesting timber and non-timber products, for preservation of the soil and water, for conservation of the biodiversity, and for social benefits and other purposes, in the particular continents, have not been sufficiently well-founded scientifically, hence. the need for optimizing these in congruity with the human needs determined in consideration with the on-going climate changes and the current socioeconomic factors. - The European Green Deal is, to a certain extent, a continuation of previous polices partly formulated in the last decades of the 20-th century and improved by means of modern philosophy and technology suggesting a new approach to reasonable taking of what is sufficient while harvesting resources.

ПОСЛЕДСТВИЯ РЕАЛИЗАЦИИ «ЗЕЛЕНОЙ СДЕЛКИ» В ЕВРОПЕ

The “Green Deal” of the European Union (EU) is a plan for decarbonizing the EU economy by 2050, structural changes in the European energy system, transforming the economy and stimulating efforts to combat climate change. But this new development paradigm will also have profound geopolitical consequences. This initiative will have a significant impact on changing the energy balance of the EU and global markets, on the countries exporting energy resources. European energy security will be exposed to new challenges and threats, which is likely to have a negative impact on the economy of a wide range of states.

Analysis of the efficiency and structure of energy consumption in the industrial sector in the European Union countries between 1995 and 2019

The industrial sector is one of the most important sectors of the global economy, having a huge impact on the development of individual countries and regions. This sector covers a wide and diverse range of activities, which makes it of key importance for the economy of the European Union (EU) countries. As a result, the processes related to energy transformation and climate policy are increasingly connected with the sector in question. The need to improve the competitiveness of the economy and the implementation of climate and energy strategies means that this sector, like the entire EU economy, must rapidly enhance its energy efficiency and the structure of energy consumption. The following paper addresses this problem by presenting the results of a comprehensive study of the structure and volume of energy consumed by this sector in the period between 1995 and 2019. Based on this study, quantitative changes and the structure of energy consumed in this sector in the studied period were determined for the entire EU and its individual countries. The use of the Gini coefficient and the Lorenz curves allowed for the determination of the inequality of energy consumption in the industrial sector. The coefficients of variation and the dynamics of changes in energy consumption, both in total and from individual sources, for the EU countries were also determined. The aim of this part of the study was to indicate directions and the intensity of changes related to the structure and consumption of energy in this sector. In the next stage, groups of similar countries were created and compared in terms of the structure of energy consumed by the industrial sector in 1995 and 2019 (using the Kohonen's neural network). Relationships between the amount of energy consumed by the industrial sector in the entire EU and the basic economic and climate parameters of the economy were also delineated. The energy intensity of this sector and the dynamics of its changes in individual EU countries over the analyzed period were also specified. The results proved a great diversity of the EU countries and the improving energy efficiency and structure of energy consumed by the industrial sector. The research, together with its results, significantly broaden the knowledge of changes in the volume and structure of energy consumption in the industrial sector for the EU countries. The results make it possible to assess the actions of individual countries and the current state of implementation of EU climate and energy policy. They should also be used to develop future assumptions of this policy.

Some new competitive advantages in the field of energetic paradigm shift from coal and gas towards the blue hydrogen production

Abstract Achieving the 2030 and 2050 climate targets gears up several economic opportunities but also a package of threats for the EU Member States. The economic crisis caused by the COVID-19 pandemic will accelerate the energy transition, which is becoming an engine of post-coronavirus economic growth. In this landscape, new economic governance, speeding up innovation, cutting the red tape, and improving access to human and financial resources becomes essential for ensuring a sustainable and long-lasting economic development which is linked with reducing the carbon emissions. Basically, a race against the clock has begun, as the first significant climate targets are to be met in 2030, aiming to reduce GHG emissions by 55% from 1990 level. Several recent studies have sought to deepen the potential of hydrogen in achieving these climate goals explaining how it can be embedded into the European Union economy. It highlighted some important features and applications of hydrogen as a substitute for other polluting resources used today in energy production, transportation, or other economic and social domains. Using a regression model, the author identified a close correlation between the increase in the price of carbon certificates and the decline in coal production. An accelerated, three-fold increase in the price of carbon certificates could enable hydrogen to be used in the power sector, while ensuring post-2030 continuity for domestic natural gas production. The combination between blue hydrogen and natural gas might be the solution to eliminate two thirds of carbon emissions from energy production, while attracting European funds, as investments for the energy transition.

Special feature on “The European Union Economy after the COVID-19 Pandemic Outbreak”: the fear of economy and the economy of fear

Special feature on “The European Union Economy after the COVID-19 Pandemic Outbreak”: the fear of economy and the economy of fear

An output-based measurement of EU bioeconomy services: Marrying statistics with policy insight

In its revised bioeconomy strategy, the European Union (EU) has extended the scope of activities to include services. Employing an output-based approach, this study quantifies the contribution of bioeconomy services to gross domestic product and employment in the EU Member States over 2008–2017. Moreover, it also identifies the main sectoral sources of employment and growth within bioeconomy services. The choice of Eurostat statistics ensures data harmonisation across countries and continuity for future updates, although important data needs are identified to enhance the representation of bioeconomy services within European statistical frameworks. In 2015–2017, economic growth was stronger in bioeconomy services than in the total EU economy. Bioeconomy services accounted for between 5.0–8.6% and 10.2–16.9% of EU gross domestic product and the EU labour force, respectively, whilst three service sectors account for more than 60% of bioeconomy services employment and value added. Interestingly, in the decade up to 2017, labour productivity in bioeconomy services improved.

Steps towards a European Fiscal Union: Has the revised Stability and Growth Pact delivered so far?

Since 2008-09, the European Union (EU) experienced two major economic crises revealing all the flaws of the existing model of economic governance. By leaving the majority of the countries with high levels of deficit and public debt, the two crises have shown that the Economic and Monetary Union (EMU) is indeed an unfinished project where the monetary union alone is not sufficient to safeguard the entire EU economy. To strengthen the EMU and to mitigate future risks that could possibly lead to the collapse of the euro-area, many called for a deeper fiscal integration by creating a central fiscal capacity for the EMU or, in other words, a fiscal union. Due to the present political unfeasibility of such an endeavour, however, concrete steps towards a European Fiscal Union (EFU) have been modest and the revised Stability and Growth Pact (SGP) remains its core building block. As the Pact defines supranational and shapes the creation of national fiscal rules, maintaining its credibility continues to be vital. This article analyses the effects of the fiscal rules on the public finances of the member states. It is assumed that by adhering to the supranational and adopting quality domestic fiscal rules, the member states are better equipped in remaining fiscally prudent, thus also affirming the revamped SGP as a solid base for the furthering of the EFU. The two-track evaluation approach defines dynamic panels for the EFU as a whole and for the selected country groups. It finds certain benevolent effects on budgetary performance at the EFU level, as well as for the countries with higher quality of the fiscal rules.

The sustainability prism of structural changes in the European Union agricultural system: The nexus between production, employment and energy emissions

AbstractOver the recent decades, the evolution of the European Union (EU) agricultural system has resulted in significant structural changes in member states. Knowledge about the nature and main patterns of structural change is critical to select a sustainable development path for the EU agriculture. This paper contributes to the academic discourse on structural changes in agriculture demonstrating the nexus between socio‐economic and environmental aspects of development. In this regard, results are important to understand the contribution of the EU agriculture to climate change, because study deals with energy use and greenhouse gas emissions. The research covers period from 2008 to 2018 and investigates the fundamental structural change measures, namely, gross value added, labour and agriculture‐related energy emissions, in EU member states. Structural changes are investigated applying a shift‐share analysis that allows calculating a performance of individual member states, compared to the EU economy. The applied shift‐share model investigates the situation of individual member states employing three components. The first component tracks the development of the selected measures with the EU economy growth, the second component shows the change due to effect of economic activities and the third shows competitiveness of agriculture in member states. The shift‐share analysis empowers ranking member states in accordance with their progress towards the sustainable development. Findings suggest that EU economy faces the outflow of labour from agriculture and this trend is common for most countries. The changes of gross value added and emissions for fuel combustion demonstrate both upward and downward trends. However, research results suggest that new member states often face more fundamental changes.

Sustainability performance assessment of the transport sector in European countries

The transport sector plays a fundamental role in the European Union economy and its efficiency is fundamental to strengthen the region's environmental and economic performance. Unfortunately, the sector still remains heavily dependent on oil resources and is responsible for a large part of the air pollution. The European Union has been promoting various initiatives towards sustainable transport development by setting targets in the sector such as the ones proposed in the 2011 White Paper on transport. Under this context, this study aims at evaluating the environmental performance of the transport sector in 28 European Union countries, from 2015 to 2018, towards the policy agenda established in the strategic documents. The assessment of the transport environmental performance is made through the aggregation of seven sub-indicators into a composite indicator using a Data Envelopment Analysis technique. A variant of the Benefit of the Doubt model is used to determine the weights to aggregate the sub-indicators. The results obtained indicate that the European Union countries have been improving their transport environmental performance in the last two years of the time span under analysis, i.e., 2017 and 2018. Regarding the inefficient countries, results suggest they should improve the transport sustainability mainly by drastically reducing the greenhouse gas emissions from fossil fuel-based propulsion, increasing the share of freight transport using rail and inland waterways and also the share of transport energy from renewable sources.