General Economic Policy Research Articles

Financial and legal status of the european central bank in the institutional structure of the european banking system

The paper deals with the problem of determining the financial and legal status of the European Central Bank (hereinafter referred to as the ECB), analyzing scientific approaches to the essence of the concept of "financial and legal status of the central bank", as well as the constituent elements that determine this status. Particular attention is paid to the correlation between the financial and legal status of the ECB and the National Bank of Ukraine (hereinafter - the NBU), namely: in powers, independence, profit sharing, and functions. The European Central Bank is an organization with a special status. Only the ECB has the exclusive right to authorize the issuance of banknotes on the territory of the community. It should be especially emphasized that banknotes issued by the ECB and national central banks are the only banknotes that have the status of legal tender in the EU. Also, its importance is emphasized by the fact that each of the member states had to ensure, at the latest - before the date of creation of the ESCB, compliance with the Treaty on the European Community and the Statute of the ESCB and the ECB, including the Regulation on the national central bank. The European Central Bank is an organization with a special status. Only the ECB has the exclusive right to authorize the issuance of banknotes on the territory of the community. It should be especially emphasized that banknotes issued by the ECB and national central banks are the only banknotes that have the status of legal tender in the EU. The financial and legal status of central banks is based on the general legal status, therefore, first of all, the general provisions on the legal nature of central banks contained in the laws on these banks are analyzed. The financial and legal status of the ECB in the institutional structure of European banking is defined in the financial and legal functions and powers, namely: in the implementation of foreign exchange operations, management and maintenance of foreign exchange reserves and ensuring the smooth functioning of the payment system, support the general economic policy of the union, and also contribute to the implementation of measures to strengthen the stability of the financial system.

Принципы долгосрочного развития Дальнего Востока

Material written by the outstanding Russian economist, Academician of the Russian Academy of Sciences, Doctor of Economics, Professor Pavel Aleksandrovich Minakir (1947–2023) in 1990 and used in the preparation of the Concept of Long-Term Development of the Far East, is published. The strategic directions for the development of the productive forces of the Far Eastern economic region are considered, taking into account probable changes in general economic policy and the economic situation in the short and long term. Approaches to building a new economic policy in this region have not lost their relevance at the present stage of development

MACROECONOMIC EFFECTS OF LABOR MARKET REGULATION IN GEORGIA

Nazira Kakulia 
 E-mail: nazira.kakulia@tsu.ge 
 Doctor of Economics, Associate Professor Ivane Javakhishvili Tbilisi State University 
 Tbilisi, Georgia
 https://orcid.org/0009-0002-8879-1339
 
 Irma Tkemaladze 
 E-mail: irma.tkemaladze@tsu.ge 
 Doctor of Economics Ivane Javakhishvili Tbilisi State University 
 Tbilisi, Georgia
 https://orcid.org/0000-0001-7880-2562
 
 Abstract: The article discusses the impact of the changes on labor market resulting from the formation of the post-industrial economy and caused by the pandemic crisis, in particular the process of employment forms’ transformation, response measures to the transf ormation of employment forms are analyzed, the stages of the employment policy for the study period are separated, the need to implement the employment policy necessary for the symbiotic development of standard and non-standard forms of employment is substantiated. We conclude that labor market policies are more "sensitive" in nature than other policies. Therefore, choosing the distortionist model emphasized by the World Bank or the interventionist model prioritized by the International Labor Organization will not lead us to the results that may have been achieved in other countries. In our opinion, it is recommended to use a more intermediate approach, which considers the labor market policy in the framework of the general economic policy, and the final goal of economic reforms is not only a high rate of economic growth, but also an increase in the well-being of the population. By studying the employment policy, it became clear that the course of the last period is actually aimed at providing effective employment, at the same time, complex measures are being taken to improve the current situation in the labor market.
 However, as determined by the conducted expert research, only the perfection of the legal framework is not enough for the effectiveness of the policy. It is necessary to strengthen the enforcement mechanism and control the results.

Formation of the mechanism of state antimonopoly policy on national consumer markets

The article examines the formation mechanism of state antimonopoly policy on national consumer markets. It was determined that the formation of the state antimonopoly policy takes place according to the state's general economic policy needs. The general economic policy of the state is established depending on the values inherent in the state in each changeable period. Depending on the values of the state, in a certain period, the goals of state regulation in general and goals of antimonopoly policy in particular form. Determined that the mechanism of formation of state antimonopoly policy includes and correlates the interests of state regulation, which correspond to the interests of the market participants majority and the interests of individual business entities. It was determined that the state component of antimonopoly regulation is subject to established norms and rules at the legislative level. Market participants, in addition to the norms and rules established by legislation, are influenced by the institutional environment. They are generally accepted market participants, norms, and rules that are not documented and not mandatory – established that an essential component of the mechanism of state antimonopoly policy formation on national consumer markets is the coordination of regulation between state authorities and non-state self-regulatory organizations consisting of market participants also interested in antimonopoly regulation. It is established that the results of antimonopoly regulation are aimed at the factors of sustainable socio-economic development, which in turn form the general economic policy of the state. Keywords: State regulation, antimonopoly policy, competition policy, mechanism of antimonopoly policy.

Do crypto investors wait and see during policy uncertainty? An examination of the dynamic relationships between policy uncertainty and exchange inflows of Bitcoin

PurposeIn this paper, the authors examine the short-term and long-term impact of general economic policy uncertainty (EPU) and crypto-specific policy uncertainty on Bitcoin’s (BTC) exchange inflows – a form of crypto investor behaviors that the authors expect to drive the cryptocurrency volatility.Design/methodology/approachThe authors use an autoregressive distributed lag (ARDL), coupled with the bounds testing approach by Pesaran et al. (2001), to analyze a weekly dataset of BTC’s exchange inflows and relevant policy uncertainty indices.FindingsThe authors observe both short-term and long-term impacts of the crypto-specific policy uncertainty on BTC’s exchange inflows, whereas the general EPU only explains these inflows in a short-term manner. In addition, the authors find exchange inflows of BTC “Granger” cause its price volatility. Furthermore, the authors document a significant and relatively persistent response of BTC volatility to shocks to its exchange inflows.Originality/valueThis study’s findings offer significant contributions to research in policy uncertainty and investor behaviors.

Start-up firms' investments: when economic policy uncertainty matters?

PurposeThis study examines the impact of economic policy uncertainty (EPU) on investment decision-making of start-up firms in Japan. While existing literature suggests firms generally retrench investment under EPU, the authors argue that start-ups’ investment behaviours are likely different given the fact that start-ups always have to compete for survival.Design/methodology/approachThe authors investigate the impact of general economic policy and policy-specific uncertainty, including monetary policy, fiscal policy, trade policy and exchange rate policy uncertainty, on corporate investment of start-up firms using multiple fixed-effect regression. A wide range of robustness and endogeneity tests are conducted to ensure the validity and soundness of the empirical findings.FindingsThe authors document a positive effect of EPU on start-up investment, to suggesting that the investment behaviour of start-ups is backed by venture capital distinct from that of mature firms. The results show that start-ups are more vulnerable during the changes in trade and exchange rate policies; uncertainties in monetary and fiscal policies do not restrain firms' investment. However, the effect varies in the cross-sections. Financial constraints have a moderating effect on the relation-ship between EPU on start-up investment. Institutional investors have an incremental effect on the positive relationship between EPU and start-up investment by encouraging risky investments.Originality/valueThis is the first study to investigate how start-up investment is influenced by EPU, thus providing a new understanding of the investment behaviour of start-up firms during uncertainty. Further investigation sheds light on the roles of institutional and managerial ownership in this newfound relationship.

Evolution of the EU Economic and Monetary Union

The article analyses the evolutionary changes that the EU Economic and Monetary Union is undergoing under the influence of the development of its main economic contradiction. The latter, according to the authors, lies in the use, on the one hand, of a single, centralized economic policy, and on the other hand, in the functioning of relatively independent national financial systems, the power of which is determined by the efficiency of the national economy. In practice, the contradiction lies in the fact that the general economic policy in most of its elements does not take into account the peculiarities of the economic development of individual countries, which makes it financially unprofitable for some of them to participate in a regional association, and stimulates the emergence of disintegration trends. The problem of diverging interests is exacerbated by many factors. One of them is competition, which under the conditions of a common market and the use of a single currency is unlimited. Other factors are related to the shocks that the EU economy is experiencing: financial crises, the COVID-19, the sanctions imposed by Western countries on Russia. The evolution of the EMU is taking place as a result of the EU's desire to mitigate the negative impact of this contradiction through the adoption of strategic and emergency measures that alleviate the problem of divergence of interests.

Special operation "Cancellation of Russia" on the world market: first results

The article examines the first most important consequences of the Western bloc's sanctions policy for the global and Russian economy. The purpose of the work: on the basis of systematization of sanctions instruments grouped into 3 packages – financial blockade, foreign economic barriers, curtailment of scientific and technical cooperation, to check the mutual effectiveness of their aftereffects. As a result of the author's analysis of the practice of sanctions pressure on the example of the US economy, the European Union and the Russian Federation, the working hypothesis of the study was confirmed: the complete isolation of the Russian economy sought by the initiators of sanctions pressure did not take place. However, the sanctions policy of the West has had a significant impact on the system of the world economy. And this influence is multidirectional and generally negative. Long-term economic growth in conditions of relative external isolation will now have to be ensured by the domestic economy of the Russian Federation, relying on the preservation and multiplication of human capital and with the help of broad state protectionism. The author suggests possible directions of adjustment of the Russian general economic policy: the docking of a set of measures for the near, medium and long-term prospects; priority development of the domestic economy with an emphasis on the preservation and augmentation of human capital; exclusion of options for autarkic development.

Principles of currency control in Ukraine

The article is devoted to the study of a complex system analysis of the current state of currency control in Ukraine. The current national financial and currency legislation, secondary legal acts and international experience in the formation of the currency system are considered. It is noted that the experience of recent years has shown that in Ukraine there is an insufficiency of state resources for financing the main tasks of the state, and significant losses of financial resources have been revealed due to violations of financial discipline. Underestimation of the role of financial control in Ukraine led to abuses and violations in the field of financial relations. Therefore, it was the complex economic processes and consequences of the global financial crisis that showed the need to improve the financial and currency policy, as well as a radical change in the paradigm of the organization of the currency control system in Ukraine. It was emphasized that the currency policy is a component of the general economic, namely, the monetary and credit policy of the state, aimed at strengthening the currency and financial position of the country, maintaining its solvency and creditworthiness at a high level, ensuring the inflow of currency from abroad through foreign economic turnover, countering flight capital abroad, attraction of foreign capital. In conditions of large-scale capital flight abroad, lack of sufficient foreign investments in the national economy, martial law - effective currency regulation can change all these negative trends for the better.The activity of any body of state power and local self-government and the state is based on the principles of legality, which are enshrined in the Constitution of Ukraine. Given that financial activity is one of the types of state activity, and currency control is an integral part of such activity, it can be argued that these principles are inherent in both financial activity and currency control.The implementation of the principles of currency control is a necessary condition for ensuring law and order and legality in the process of carrying out financial activities.

ПРАВОВІ АСПЕКТИ ЦИФРОВІЗАЦІЇ МІЖНАРОДНОЇ ТОРГІВЛІ ШЛЯХОМ УПРОВАДЖЕННЯ ТЕХНОЛОГІЇ БЛОКЧЕЙН (ДОСВІД ДЛЯ УКРАЇНИ)

The article is devoted to the study of the peculiarities of digitalization of international trade through the introduction of blockchain technology and the identification of issues that require legal regulation for the implementation of the relevant process in Ukraine. It is emphasized that digitalization of international trade through the introduction of blockchain technology opens up opportunities for optimization of administrative trade procedures and stimulation of foreign trade activity, in particular, it allows modernizing and optimizing the work of “single windows” (including certification and customs clearance); cross-border data exchange between government agencies or authorities and economic entities; payment transfer system, etc. In turn, the use of smart contracts, built on the appropriate technology, can automate the compliance of stakeholders with various contractual obligations; and data (in the blockchain) — is a stream of reliable information about past transactions, as they remain unchanged after entry. This provides greater transparency and the ability to trace the movement of a product or document throughout the supply chain with a high level of security and immutability, as well as eliminates double spending (in particular, by using the same digital documents as collateral for financing, which is a common source of fraud in international trade. At the same time, blockchain technology is only a tool on the way to optimizing administrative trade procedures and stimulating foreign economic activity and can be used only if there is appropriate legislation. In particular, the issues of determining the legal status of the blockchain (in particular, the terminology — “blockchain”, “smart contracts”) and blockchain-based applications need to be settled. Analysis of international experience proves the lack of unified approaches in this area. This actualizes the need to intensify work at the global international level to address the above issues. It is also advisable for Ukraine to join this process. For the sake of end-to-end digitalization of trade and limiting the possibility of potentially conflicting individual approaches that could lead to further disconnection and barriers to trade, harmonization of domestic legislation in accordance with existing international documents (in particular, UNCITRAL model laws) is becoming important. Digital trade agreements (e.g., the upcoming Digital Trade Agreement between Ukraine and the United Kingdom) are one of the tools that will help to intensify actions in this direction. In addition, among the issues that require regulation prior to the introduction of blockchain technology in international trade are the following: (1) the procedure for entering data (in particular, ensuring their accuracy and completeness) to be transmitted and exchanged on the blockchain; (2) protection of the transmitted data, (3) responsibility for data entry and processing, as well as the legal algorithm for their correction in case of errors (in particular, it should be clearly defined whether it is possible to make changes to the code underlying the blockchain to correct errors and, if so, who has the right to do it), (4) dispute resolution procedure; (5) mutual recognition of documents/certificates issued (this will ensure that the algorithms used work accurately with the data entered and comply with specific (international and national) rules), etc., as well as recognition of electronic signatures and electronic documents (in particular, transfer documents, bills of lading, promissory notes, warehouse receipts, etc. On this basis, it is considered expedient not to adopt a separate legal act like the Illinois State Law “On the Implementation of Blockchain Technology”, but to modernize the existing laws of Ukraine: the Law of Ukraine “On Electronic Commerce”, the Law of Ukraine “On Electronic Documents and Electronic Document Management”, etc. These are the directions of further research. It is considered appropriate at the legislative level to allow the use of smart contracts, records and signatures protected by blockchain in the field of trade and to use the method of analogy of the law in order to extend the legal regime of electronic contracts and signatures to them, which is reflected in the law-making of certain foreign countries (in particular, the United States (New York State). It is proposed to develop and adopt legislation on the digitalization of economic policy in general and foreign economic policy in particular, taking into account the principles of functional equivalence and technological neutrality. This will protect domestic legislation from the need for constant amendments to take into account the emergence of new technologies.

Reference Price for the Mexican Crude Oil Mix Export Price: An Alternative Estimation for the Budget and Fiscal Responsibility Law

This paper aims to perform an alternative methodology the Ministry of Finance and Public Credit (SHCP) applies to estimate the annual Mexican Crude Oil Mix Export Price (MXM), a crucial element of the General Economic Policy Criteria in the Economic Package. We first identify the MXM and the West Texas Intermediate (WTI) relation, computing tail conditional dependence between both series. Subsequently, we use a market risk analysis approach that considers some methodologies to estimate the value at risk (), including an ARIMA-TGARCH model for the innovations of the MXM's price to forecast its behavior using data daily data from January 3rd, 1996, to December 30th, 2021. Once we identify the VaR and the ARIMA-TGARCH components, we aim to design an alternative method to estimate the annual average MXM's price.

Bir Osmanlı Sancağı Olan Üsküp, İktisaden Narh Cezalarıyla Değerlendirilebilir mi?

Migration is moving from one place to another place. Extraordinary situations such as wars, epidemics or natural disasters end with the displacement of people and thus their migration, which leads to some consequences in terms of both migration sending and receiving sides as well as social and geographical consequences. The 93 War between the Ottoman Empire and the Russian State witnessed a great migration wave. Especially with the loss of Bulgaria after the war, the Muslim people living in Bulgaria became refugee and were settled in Skopje, an important Ottoman sanjak due to its strategic location, by the Ottoman State. The Ottoman Empire used every opportunity for the Bulgarian immigrants to maintain their lives. It implemented price control, which is one of its general economic policies, effectively to that end. As in other regions within the borders of the Ottoman Empire, it continued this control which means narh policy in Skopje, and punished those who acted in the opposite direction. The aim of the study is to evaluate the Skopje during and after the 93 War within the scope of fines of narh.

Summaries of Papers In This Issue

Summaries of Papers In This Issue

Climate change and the mandate of the ECB: Potential and limits of monetary contribution to European green policies

The ECB’s mandate regarding climate change is being actively debated. According to some, the ECB’s mandate excludes any climate-related role, while others argue for a broad responsibility of the ECB in this context. This article argues for a middle way: under certain conditions, the ECB should take climate change into account and act accordingly while pursuing its objectives. EU law and the overall constitutional structure of the Union also provide limits as to how much the ECB can do in this field. This article focuses on the interpretation of the secondary objective of the ECB, according to which the ECB shall support the general economic policies in the Union with a view to contributing to the achievement of the Union’s objectives. This argues that this objective might lend support to ECB measures with an environmental dimension, but it only establishes a contributory power: the ECB cannot make its own environmental policies. ECB, central banking, mandate, monetary policy, climate change, institutional balance

The History of the Transformation of Cuban Socialism in the Context of Contemporary Reforms: A Political Economy Perspective

The paper explores transformation of the contemporary Cuban model of socialism. The purpose is to ascertain the dynamics of the interpretation of socialism as a mode of production in three different stages. It draws on crucial sources such as the 1976 Constitution of Cuba, its 1992 amended version, and the 2019 Constitution. Each corresponds to one of the three models of development identified in the article: the Marxist-Leninist model, the special period model, and the model of actualisation process. The author also takes a more detailed look at the official documents of the First, Sixth, and Seventh Congresses of the Cuban Communist Party, reflecting aspects of socialism as a mode of production and the role of Marxism-Leninism. The paper examines issues such as forms of ownership of the means of production, changing attitudes towards exploitation, the operation of the socialist principle of distribution “from each according to his ability, to each according to his work”, and the role and scope of the planning sys-tem. The author's methodology rests upon the historical-genetic method and comparative analysis. The study indicates that Cuban socialism as a mode of production has undergone considerable changes over the course of its history. The planning system has lost its scale and short-term planning is being trans-formed from directive to indicative, while general economic policy is moving away from instruments of administrative intervention towards indirect regulation. Mid and long-term planning gets closer to the models of strategies. The actualisation model also legalises private ownership of the means of production, while the special period model views cooperatives as a socialist form of economic management. Although exploitation is condemned, the actualization model integrates it into the social system having legalised wage labour. The socialist principle of distribution is regarded only as a desired principle, but not as a functioning one. Thus, changes in the interpretation of socialism as a mode of production have been enshrined at the official level. Contemporary Cuban socialism has moved away from the Marxist-Leninist model adopted in the 1960s.

Value Changes in National Currency in Foreign-Dependent Economies & Turkey Example in The Context of Crises

In this paper, the status of devaluation realized in general economic policies to decrease current account deficit and increase exports in terms of increasing or not decreasing current account deficit is defined and used as the “Devaluation Paradox.” In this context, in this paper, the effects of devaluation, inflation, unemployment, and current account deficit variables on national currency in foreign-dependent economies have been investigated. For this purpose, changes that took pl

Incoming control parameters for PVC sheets used for the production of plastic cards

One of the main requirements for obtaining high-quality raw materials for production is a clear formulation of the necessary parameters that the manufacturer of materials must comply with in the production of raw materials. The very observance of these parameters in the future will reduce the number of production of unsuitable products and plastic cards with defects.
 Parameter control is carried out for each separate batch of materials. The sample during inspection should be at least 0.1 % of the total amount of material, the deviation from the parameters should be included in the tolerance.
 The tasks of the stage of product quality control should ensure the implementation of the quality policy, as well as the general economic policy of the enterprise. Control is an integral part of the activities of any enterprise, a regulator of factors that form quality at all stages of the production process and ensure the release of quality products.
 Based on the analysis and experimental studies, the main parameters that need to be monitored were determined: geometric dimensions, color, thickness, density, surface tension, tensile strength, uniformity of paint application, shrinkage during sheet sintering

India in the Post-Bipolar World: 30 Years of Searching the Place

The article analyzes the tools and mechanisms that Indian elites used to adapt the country’s foreign policy to the post-Cold War world order. We describe the internal political development of India over the past 30 years, noting that the general foreign and economic policies remained unchanged due to the political consensus. We analyze the desire of the Indian leadership to form a solid economic foundation, which is perceived in the framework of India’s strategic thought as a prerequisite for the country to claim the status of great power. Finally, we discuss the primary imperatives of the Indian external policy, i.e., building a sphere of influence necessary for the polycentric world. It is noted that India’s main external security challenges remain the same (China and Pakistan), although they have changed qualitatively: the PRC has become one of the superpowers, overtaking India in terms of economic development, and Pakistan acquired nuclear weapons. We conclude that, on the whole, the Indian elites managed to relatively safely lead the country through the chaos of the post-Cold War world, turning it into one of the largest economies in the world and providing the necessary conditions for raising its status in world politics.

Energy market uncertainty and the impact on the crude oil prices

Our paper proposes a novel measure of global energy market uncertainty and studies its impact on oil prices. The current literature primarily relies on a single or small number of observable variables, or general macroeconomic uncertainty (JLN) and economic policy uncertainty (EPU) indices to reflect energy market uncertainty. Using a Factor Augmented Vector Autoregression model (FAVAR), we construct time-varying global energy market uncertainty in a data-rich environment. Our estimates show variations from JLN and EPU proxies. The results reveal that real oil prices respond strongly to our proposed aggregate energy market uncertainty shocks. We also find heterogeneous responses to different types and magnitudes of uncertainty shocks. The real price of oil is affected the most under unexpected strong demand for alternative energy sources scenario.

How Do You Solve a Problem Like Maria?US – Countervailing Measures (China) (21.5)

AbstractThe rise of China as a genuine world power, economically and militarily, constitutes the gravest challenge faced by the liberal international order constructed in the aftermath of the Great Depression and the Second World War. A major source of strain in the trade relations between China and the other core members of the liberal world trading system is its extensive use of state-owned enterprises as an instrument of general (domestic) economic policy. This paper builds on Ruggie's theory of embedded liberalism and the theory of economic policy to characterize the political and economic difficulties and opportunities in moving toward a new regime for dealing with subsidies. The conclusion sketches some goals such a regime should seek to embody.