Low Level Of GDP Research Articles

Services Sector Export in Europe

In this paper, we consider the changes that occurred in the service exports of thirty-eight European countries in the period of 2005–2016. We have found that the existing world trend related to the growth of service exports is also present in Europe. However, the trend of the service exports’ share growth in the general volume of export is not common for all European countries. We found that higher growth rates are observed in European countries with lower levels of GDP per capita. We also discovered the presence of a strong positive correlation between growth in service exports and GDP growth, as well as between growth in service exports and GDP per capita. We also found that there is a linear correlation between the growth of service exports and the growth of GDP per capita, as well as between the growth in service exports and GDP growth. The data obtained allowed us to conclude that European countries, categorized as “Innovation Leaders” in accordance with the European Innovation Scoreboard, are not the leading countries in Europe with regard to the rates of service export growth. We also discovered that service exports in Europe are less sensitive to adverse macroeconomic effects than goods exports.

Modelling the relationship between energy intensity and GDP for European countries: An historical perspective (1800–2000)

In this paper we discuss an original article by Gales et al. (2007) concerning the relationship between total energy intensity and GDP per capita. In their chiefly descriptive analysis of four European countries (Sweden, the Netherlands, Italy and Spain) over the last two centuries, no inverted U-curve relationship was found between total energy intensity (sum of traditional and modern energy sources) and GDP per capita. By contrast, in addition to considering total energy intensity we also distinguish between modern energy intensity and traditional energy intensity. Further, we integrate qualitative analysis with empirical analysis (i.e., the ARDL cointegration procedure) in order to make our results more robust. The main conclusions of Gales et al. (2007) are only partially confirmed: considering total energy intensity can lead to erroneous conclusions. In particular, our estimates show a U-shaped relationship between total energy intensity and GDP per capita. In addition, when we decompose total energy intensity, two different relationships emerge: a hyperbolic pattern (traditional energy carriers) and a U-shaped inverse pattern (modern energy carriers). We conclude that the decreasing branch of the U-shaped relationship between total energy intensity and GDP per capita is driven by traditional energy sources when the latter dominate modern energy sources (low levels of GDP per capita). In contrast, the ascending branch of the U-shaped relationship is driven by modern energy sources when prevailing over traditional sources (high levels of GDP per capita).

THE REAL SECTOR OF UKRAINIAN ECONOMY CAPITALIZATION: TRENDS AND CONSEQUENCES

Introduction. The main trends in the corporate finance of Ukraine hardly could be explained with the traditional corporate finance frameworks which the trading-off or pecking order approaches included. In the beginning of 2017, the whole corporate sector indebtedness (calculated as total unconsolidated debt to book value based equity ratio) was substantially higher than a proper level for emerging markets countries. The restoring of the real sector equity capital sufficiency is crucial for the whole financial system stabilization and investments fostering. Purpose. The investigation of the book value decapitalization in real sector of Ukrainian economy scale and its potential impact on the financial system stability and economic growth assessment. Methods. International comparisons of the total book value capital to GDP ratios, the real book value capital (denominated by GDP deflator) trends and structural changes investigation. Results. The volume and the dynamics of the book value capitalization in Ukrainian economy’s real sector are investigated. The overall level of capital losses is determined (18% decline with 5 years) and significant structural imbalances are revealed. The trends of real sector book value equity changes analyzed comparing with the nominal GDP changes trends in Ukraine and foreign countries. A comparative analysis trends of real sector capital return in Ukraine and some European countries is conducted. The total book value capital to GDP ratio in Ukraine does not differ significantly from other countries. We explain these results capital by the low level of GDP in Ukraine and not by the book value capital sufficiency. The low level of legal productivity the real sector aggregate equity capital in Ukraine is determined. The share of accumulated capital in real sector book value equity in Ukraine was closed to 0 and fall negative in 2017. We explain this by the low level of legal productivity of equity capital in Ukraine. Conclusion. The capital accumulation in the real sector of Ukrainian economy is structurally deteriorated and generates significant risks for the stability of ountry financial system. The lack of capital in real sector hardly can be compensated by the financial sector and government investments. Thus, we can conclude that deficiency of equity in real sector is a strong barrier for the economic growth.

Assessing Ict Role to Economic Convergence of Albania and Western Balkans to European Union

The Western Balkans countries are still considered economies in transition. Coming from centralized systems with low level of GDP per capita the region can accelerate substantially the growth pace as lectured in neoclassical growth theory. The region is considered attractive for foreign investments due to a series of advantages such as the political EU agenda and vicinity to EU markets, low labour costs combined with relatively well educated people. The growth models recognize the importance of technology factor to sustain the productivity, competitiveness and economic growth. Promoting innovative businesses and introducing information and communication technologies (ICTs) will enhance the potentials for economic convergence towards developed economies such as EU. The aim of this paper is to bring in focus the impact of ICT on productivity in the Western Balkans (WB) as well as to the structural convergence within the region. One of the contributors for introduction of new technologies and use of ICT remains the foreign direct investments. The paper will assess the role of FDIs in modelling aggregate production reflected through the exports variety and in particular ICT and high technology goods exports. The methodology of the paper makes use of time series data for a set of indicators for each of the Western Balkans countries: Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia. The main conclusion is that the Western Balkans and Albania have shown a slight trend of convergence of productivity among them and to EU by still is not following the same pace as the convergence of GDP per capita. The impact of ICT development in Albania at firm level but also at economic growth is lower than in other Western Balkans countries. The penetration of FDIs in Albania has generated limited contribution to the introduction of new technologies and sophistication of business models. Additionally, it is necessary to address some incentives to promote ICT businesses and professional skills in order to enable the innovation and competitiveness of Albanian economy. JEL classification: F15, F43, O16, O47.

ECONOMIC DEVELOPMENT OF THE COUNTRY AND INNOVATIVENESS IN THE FOOD INDUSTRY COMPANIES – SELECTED ISSUES

The purpose of the article was to assess the innovation of the food industry in the EU Member States. Innovation of the food industry was compared with the level of economic development of countries, innovative enterprises in general, and the importance of the food industry of individual countries in the domestic economy and the EU. The analyzes were based on data from the Eurostat database. The results indicate the occurrence of the relationship between the level of innovation of enterprises of the food industry and the level of economic development of countries and the overall innovation performance of enterprises in the manufacturing sector. In this regard, we observed it in general as a priority for countries of the old EU. In the case of Germany, Italy, Belgium and the UK, it was also heavily associated with countries in the EU food industry. Estonia, Lithuania, the Czech Republic and Portugal were characterized by high levels of innovation of the food industry despite the relatively low level of GDP per capita and overall enterprise innovation.

THE MONITORING OF THE TAX BURDEN IN THE UKRAINE AND THE COUNTRIES EU

Introduction. In Ukraine, which chose European integration course, there is a need for constant depth analysis of all phenomena and processes that play an important role in the development of tax systems and use taxes as an instrument of state regulation. For Ukraine it is important to consider and study in detail all the trends that are characteristic for EU countries to apply extensive experience in taxation. This will ensure the stability of the socio-economic development and to optimize the tax burden. The purpose of the article is covering the theoretical and methodological aspects of the definition of the tax burden, the analysis of the impact of the tax burden on business entities and shaping the prospects of optimize the tax burden with European experience. Results. The author attempts to evaluate the level of tax burden in Ukraine and the EU Member States in this article. The main trends, specific to the tax systems of the EU-27 and Ukraine, are investigated. Regularities of establishing the level of taxation and the ratio of different tax payments in the structure of tax systems are defined. Showing, how to optimize tax burden in fiscal Ukrainian practice in terms of European integration. Conclusion. The study showed that the tax burden is an important parameter that expresses the state guidelines for socio-economic policy. The level of tax burden in Europe is much higher than in Ukraine. The low level of GDP in our country per capita does not allow for qualitative social policy. GDP growth depends on the creation of a favorable investment climate. Reforming the tax system of Ukraine should consider Taxation of foreign countries. In particular, the use differentiated tax rate for individual tax rates Single Contribution gradual reduction and simplification of tax administration in general, and reducing the tax burden due to improvements in the distribution and redistribution of GDP

Output gains from accelerating core inflation

Previous research finds that the analysis of sacrifice ratios–namely, identifying disinflation episodes, calculating the sacrifice ratio, and looking at its determinants–changes substantially when one moves from headline to core inflation. This paper examines whether similar findings are obtained when examining benefice ratios, and we find arguably even greater differences. Specifically, we see that headline inflation identifies far more inflationary episodes since the 1990s than core inflation does. Furthermore, Jordan’s (1997) argument that the speed of inflation is a negative and significant determinant of benefice ratios does not hold when we move from headline to core inflation, both within the U.S. and also across the OECD. We also find strong evidence that the initial level of GDP at the onset of an inflationary episode matters. In particular, output gains from accelerating inflation appear only to be beneficial for OECD countries that start with a low level of GDP. Conversely, countries that start with a high level of GDP should not pursue additional output gains from allowing a rise in inflation.

Local Tax Policy in the Function of Development of Municipalities in Serbia

The state and local communities must have an active tax policy to contribute to the achievement of their economic and social objectives, whereby they have to find an adequate measure as not to jeopardize the economic and market principles and a favorable economic environment. In conducting the tax policy, priority should be given to built-in incentive instruments in relation to the “ad hoc” measures of tax competition. The practice of giving subsidies and tax incentives in the near past in Serbia has not yielded satisfactory results: extremely high rate of unemployment, low level of GDP per capita, high indebtedness and foreign trade deficit. Because of this, the local government in the coming period must have a much more active role in managing local tax policy in order to stop the negative economic trends and standards of their population. We argue that the highest degree of efficiency is achieved, if the fiscal policy measures are in correlation with economic and structural policies and have a strong synergetic effect.

A Long Constitution is a (Positively) Bad Constitution: Evidence from OECD Countries

This article starts with two empirical observations from Organisation for Economic Co-operation and Development countries about longer constitutions: (1) they are more rigid (that is, more difficult to amend) and (2) they are in practice more frequently amended. The study presents models of the frequently adopted rules for constitutional revision (for example, qualified majorities in one or two chambers, referendums) and demonstrates that, if longer constitutions are more frequently revised, it is because they must impose actual harm on overwhelming majorities. In trying to explain this finding, the article demonstrates that longer constitutions tend to contain more substantive restrictions. Countries with longer constitutions also tend to have lower levels of GDP per capita and higher corruption. Finally, the negative effect of constitutional length on GDP per capita is shown to persist even if corruption is controlled for.

Has Bolivia׳s 2006–12 gas policy been useful to combat the resource curse?

The resource curse is a phenomenon regularly evoked in the economic literature on under-development. Given Bolivia׳s low level of GDP per capita and its international insertion based on primary commodity exports, this country is a good candidate for the resource curse. The goal of this paper is to investigate the changes to Bolivia׳s gas policy since 2006 and the evolution of its industry via three aspects: production and inversion, exports, and gas industrialization. In this way we can assess the extent to which policy changes and institutional performance in Bolivia are managing to attenuate some aspects of the resource curse (or not), especially patterns of international insertion. The main conclusion is that the current government has not developed a strategy against the resource curse: instruments to overcome the country׳s productive specialization or primary-export-led international insertion have not been established, and productive linkages have not been encouraged. Instead, the priority of the policy has been to increase State participation in the control (but not the generation) of oil revenues, and significant production changes have not yet been achieved. Ultimately, some aspects of the resource curse have not been attenuated.

The relations of real and nominal convergence in the EU with impacts on the euro area participation

Real convergence of economies in macroeconomic terms is accompanied by convergence of nominal variables. The paper provides an analysis of the relationship of the GDP per capita development as an indicator of the real convergence and the development of the comparable price level as a representative of the nominal convergence in relation to the EU average value in the EU economies. Using the concept of convergence, the development of variability of real and nominal convergence indicators among the EU and euro area economies is also evaluated. The Maastricht criteria are an alternative concept of the nominal convergence and their fulfilment interacts with the convergence in previous conceptions. The aim of the paper is to detect relationships between the real and nominal convergence via given indicators within the EU economies, with impacts on the euro area participation regarding the obligations to comply with the Maastricht criteria. In this sense the impacts on the new Member States are taken into account. It is clear that countries of the EU with lower levels of GDP per capita also achieve lower price levels and that simultaneous real and nominal convergence is likely to occur in these countries. The Maastricht criteria may lead to negative effects on the catching up economies joining the euro area, which experience simultaneous real and nominal convergence in the above mentioned conceptions.

Chronic Poverty and Development Policy in Sri Lanka: Overview Study

Sri Lanka is well known for achieving high levels of human development at relatively low levels of GDP per capita. Successive governments have invested heavily in education, health and welfare programmes, and this has been associated with the country achieving levels of life expectancy and literacy that are comparable to industrial countries. However, these human development achievements and high levels of public expenditure on social welfare, have not eradicated deprivation. Factors contributing to the prevailing poverty levels include inadequate economic growth; low economic benefit trickle down to the poor; high state expenses on defence due to the prevailing secessionist conflict in the North; and inefficient allocation of resources to the deprived populations and regions in the country, based in part on a lack of differentiation of the poor. In the absence of systematic information on the chronically poor, the present study attempts to capture chronic poverty in Sri Lanka by examining general information on poverty and drawing conclusions on those who are likely to be among the chronically poor. Certain population groups that are likely to experience poverty over many years (or all their lives) are examined in this review. These include the internally displaced persons from the conflict, disabled, elderly, street children, employed children, female headed households and youth. The poor are also examined using a 'livelihood' framework. Examination of human capital in terms of education, health and nutrition show that despite free services, the poor have not always benefited, leading to low education, and poor health. In turn, these are associated with lower access to well paid employment as well as reduced labour productivity. Access to physical capital is also low for the chronically poor, in terms of infrastructure provided by the state, housing and productive assets such as land and irrigation facilities. The poor are also more prone to environmental problems such as rainfall, deforestation and soil degradation, with a depressing effect on their productivity and income. The chronically poor experience financial instability associated with low wages, low skills, seasonality of employment, employment opportunities limited to hired labour, deterioration of real wages, high food expenditure ratio, high expenditure on alcohol, inadequate income support from state poverty alleviation programmes and low access to credit facilities. Overall, the need for the government to redirect its welfare policies and programmes to more adequately assist the poor is apparent. At present the government is in the process of developing a Poverty Reduction Strategy Paper for Sri Lanka to address the issue of high levels of poverty in the country. However, certain information gaps with regard to the livelihoods of the poor and differentiation of the poor by deprivation levels for specific and effective interventions needs to be addressed. The review concludes with highlights of areas for future research on chronic poverty in Sri Lanka.

The Clean Development Mechanism and its implementation in China: an economic analysis

Abstract The “low-hanging fruits” (LHF) (or cream-skimming) problem receives some attention in recent years. However, few studies provide formal analysis on the LHF problem and other flaws based on economic theory. This paper investigates the LHF problem of Clean Development Mechanism (CDM) in China. The energy consumption and the Green House Gas (GHG) emission in China are outlined. The details of the CDM projects, including their distribution in China, and the types of projects are summarized. In order to test whether there were LHF problems in China, a simple statistical model is developed. The statistical analysis provides an indirect evidence that the LHF problem exists in China. The results indicate that areas with higher emission of GHG and low level of GDP per capita attract more CDM projects with higher amount of Certified Emission Reductions (CERs). The results are robust after eliminating HFC-23 decomposition projects from the sample.

Assessment of financial flow in the health system of Serbia in a period 2003-2006

The main goal of every health policy is not merely the establishment of the health system sustainability, but the accessability of health services to the whole population, as well. This objective is shared in European Union countries, and the consequence is the implementation of National Health Accounts (NHA). NHA, as a tool for evidence-based management, provides data regarding financial flow in health at national level and allows international comparability. The aim of this study was to determine Serbian overall health spending patterns by National Health Accounts, and to determine health care indices to provide policy makers with internationally comparable health indicators. A retrospective analysis of healthcare expenditures was obtained from the published final financial reports of relevant state institutions during a period of 2003 to 2006. The various sources of data on healthcare expenditures were connected according to instructions by the OECD "A System of Health Accounts (SHA)" Version 1.0. The obtained results showed: health expenditures in Serbia made up 8.6%, 8.3%, 8.7% and 9% of the GDP in 2003, 2004, 2005 and 2006, respectively; the Health Insurance Fund was a predominant financing source of the public sector with 93% in 2006; the largest part of the total health expenditures went towards hospitals and for health services; the expenditure per capita in 2006 was 365 US$; Serbian population finances the state institutions "out of pocket" with 21.28% of their sources, which was 7.3% of the total healthcare expenditures, and the private institutions with 78.72% of their financial sources, which is 27% of the total healthcare expenditures. In 2006 Serbia allocated financial resources out of GDP in the amount similar to the European Unity, while comparing to the countries of the region, these funds were less only than in Bosnia and Hertzegovina. This allocating of financial resources in total, however, was low as the consequence of relatively low level of GDP in Serbia. Establishing NHA provided a pattern of national healthcare spending and allowed a comparison of healthcare system in Serbia with the systems of other countries. Analysing a period 2003-2006 revealed a similarity between Serbia and the countries of the European Unity in regard to the level of average financial resources allocation for healthcare expressed as a percentage of GDP, as well as in regard to financiers in the system of healthcare. A high purchasing power disparity, however, in healthcare services was observed between the population of Serbia and other European countries.

A Subnational Study of Insurgency: FARC Violence in the 1990s

This article examines the traditional political and economic factors that have been purported to explain the prevalence of insurgency. It tests the following hypotheses at the subnational level in Colombia: guerrilla violence is positively associated with exports; higher levels of insurgency are associated with low levels of GDP per capita or negative growth rates; guerrilla violence emerges in the context of weak state presence; and higher levels of state repression are associated with higher levels of insurgent violence. The analysis utilizes a zero-inflated negative binomial to capture dynamics of both intensity and onset of violence. The econometric analysis is supplemented with cartographic visualization and qualitative analysis.

Foreign Aid and International Support as a Gift Exchange

Regressions on data from 1948 to 1979 indicate that the US and the Soviet Union used foreign aid to stimulate international political support from the receivers of aid and that aid receivers allocated their political support to stimulate aid from these donors. The regressions are based on a game theoretical model in which aid donors provide aid to reach foreign policy goals and in which aid receivers in return give political support to the donors so as to raise foreign aid. With foreign policy ambitions, aid should be given the countries with low GDP levels, while if altruistic considerations determine aid, countries with low levels of GDP per capita should be the beneficiaries. Since foreign aid to some extent was the result of cold war rivalry, the changes in international relations which occurred with the fall of the Soviet Union, should lower total foreign aid.

Constitutional design and economic performance

This paper is motivated by the belief that some cultural traits favor economic performance more than others. One trait examined is the ease with which individuals in a community drift away from the spirit of the law for their own benefit; this, it is argued, generates verbose legislation and high-transaction-cost institutions with deleterious effects on economic performance. An empirical comparison between the number of articles in a country's constitution, as a proxy for length and lack of simplicity, and economic performance as measured by GDP per capita finds that no country with a high GDP per capita has a long constitution or, restated, that long constitutions are invariably associated with low levels of GDP per capita.