Macroeconomic Imbalances Research Articles

Evaluating economic and social convergences across European countries: Could Macroeconomic Imbalance Procedure indicators shed some light?

Evaluating economic and social convergences across European countries: Could Macroeconomic Imbalance Procedure indicators shed some light?

Macroeconomic imbalances in Europe: How to overcome the fallacy of unit labour costs

Policy recommendations based on unit labour costs (ULC) indices can lead to undesirable and counterproductive policies, because they do not reveal possible distortions in the base year. In this paper, we discuss the problems with the ULC-current account relation and provide an alternative measure for relative wage costs called Wage Competitive index (WCI) based on the assumption of convergence of the returns on capital. We show how to calculate it and that it is more efficient than traditional ULC and REER indicators. The implication is that policymakers should not focus on nominal wage setting only, but also more broadly on all factors which affect the return on capital. This implies that the well-known Rehn–Meidner rule, which underlies the Macroeconomic Dialogue should be modified.

Макроекономічний вимір фіскальної політики в умовах розгортання глобальної кризи

Fiscal policy in the context of global crisis has been analyzed in the article. With the appearance of global crisis processes, threats and macroeconomic imbalances arise, which inevitably lead to a decline in production, shortages of financial resources and a slowdown in economic development in general. Only an effective fiscal policy can ensure the formation of the state budget and the optimal use of expenditures for long-term economic growth and improving welfare of population. Relevance of the article is justified by the fact that fiscal policy in Ukraine today requires new approaches that would be based on the experience of foreign countries and would take into account peculiarities of the domestic economy. The purpose of the study is to analyze current trends in the implementation of fiscal policy in Ukraine, to identify ways and directions aimed at creating effective fiscal mechanisms focused on European norms and standards. The authors analyze dynamics of budget indicators for the period of 2015-2020 on the basis of statistical data. The analysis allows us to conclude that in this period there is a tendency to exceed the volume of state budget expenditures over revenues, which leads to a threatening increase in budget deficit and public debt. Considerable attention is paid to the study of foreign experience. Based on the analysis, it was found that to solve the problem, governments pursue fiscal policies aimed at reducing budget expenditures and increasing the tax burden on the economy. The analysis allows us to conclude that coordination of fiscal mechanisms needs to be improved and strengthened in order to reduce the gap between expenditure and revenue budgets, counter the threats of the global crisis and achieve common goals. The economic strategy of state should be aimed at improving capacity of existing and finding new fiscal mechanisms using world experience.

A European Minimum Wage: Implications for Poverty and Macroeconomic Imbalances

A hypothetical European Minimum Wage (MW) set at 60 percent of each country’s median wage would reduce in-work poverty but have limited effects on overall poverty, as many poor households do not earn a wage near MW and higher unemployment, higher prices, and a loss of social insurance benefits may erode direct benefits. Turning to competitiveness, since the MW increase to reach the European standard would be larger in euro area countries with excessive external surpluses, the associated real appreciation should help curb existing imbalances. However, a few countries with already weak external positions would experience an undesirable real appreciation.

A European Minimum Wage: Implications for Poverty and Macroeconomic Imbalances

A hypothetical European Minimum Wage (MW) set at 60 percent of each country’s median wage would reduce in-work poverty but have limited effects on overall poverty, as many poor households do not earn a wage near MW and higher unemployment, higher prices, and a loss of social insurance benefits may erode direct benefits. Turning to competitiveness, since the MW increase to reach the European standard would be larger in euro area countries with excessive external surpluses, the associated real appreciation should help curb existing imbalances. However, a few countries with already weak external positions would experience an undesirable real appreciation.

Macroeconomic imbalance procedure (MIP) scoreboard indicators and their predictive strength of ?multidimensional crises?

Research background: The evaluation of the predictive strength of MIP indicators in relation to crises is extremely important for the process of coordinating the economic policies of the EU countries. MIP is one of the pillars of the economic crisis prevention procedure. Predictive power of individual indicators has not been tested before their introduction.
 Purpose of the article: Evaluation of the predictive strength of fourteen MIP indicators in relation to multidimensional crises in the EU countries.
 Methods: We used ordered probit model to test the ability of MIP indicators to correctly predict episodes of ?multidimensional crises? (as defined by the authors) in the period between 2008 and 2017 in all EU Member States.
 Findings & Value added: We defined ?multidimensional crises?, combining several negative phenomena into one limited dependent variable. This work is also novel in its application of probit regression to test the predictive strength of MIP indicators with an ordered probit model. We identified five MIP variables which were statistically significant in predicting ?multidimensional crises? for all EU countries: net international investment position, nominal unit labour cost index, house price index, private sector credit flow and general government gross debt. Other variables turned out to be less important or not effective in crises prediction.

EMU and the Italian debt problem: destabilising periphery or destabilising the periphery?

ABSTRACTWhile during the first decade the common currency helped stabilise the Italian economy by overcoming political constraints that blocked debt reduction, during its second decade the euro has rather served to destabilise the country politically and economically. The combination of a single currency and a single market in financial services turned into an engine of massive macroeconomic imbalances that came to a head in a typical sudden stop in the years following 2009. While Italy had steered clear of the financial imbalances of the southern periphery during the first decade of EMU, its debt legacy problem, despite continuous primary surpluses, made it a target for financial contagion during the second. The EU’s recipe of austerity and structural reform exacerbated the problem thus reversing the long-term trend of falling debt to GDP ratios and handing an electoral victory to populist Euro-sceptics by a public that increasingly came to see the EU as a threat to prosperity and social inclusion.

Zimbabwe

This 2019 Article IV Consultation focuses on Zimbabwe’s near- and medium-term challenges and policy priorities and was prepared before COVID-19 became a global pandemic that has resulted in unprecedented strains in global trade, commodity, and financial markets. It, therefore, does not reflect the implications of these developments and related policy priorities. The outbreak has greatly amplified uncertainty and downside risks around the outlook. The IMF staff is closely monitoring the situation and will continue to work on assessing its impact and the related policy response in Zimbabwe and globally. With another poor harvest expected, growth in 2020 is projected at near zero, following a sharp contraction in 2019, with food shortages continuing. With no progress on clearing longstanding external arrears, the authorities face a difficult balance of pursuing tight monetary, to reduce very high inflation, and fiscal policies to address the macroeconomic imbalances and build confidence in the currency, while averting a crisis. Pressures are mounting to increase spending on wages and for social protection to mitigate the impact of the weather shocks and high inflation. While the 2020 budget includes a significant increase in social spending, it is likely insufficient to meet the pressing needs.

Is a Bubble Inflating on Poland’s Housing Market? (Czy na polskim rynku mieszkaniowym narasta bańka cenowa?)

English Abstract: The year 2019 brought double-digit growth in Polish housing prices, for both new and existing homes. In some cities, real prices for residential real estate have reached the highest levels in history, even higher than at the peak of the boom in 2008. As a result, some are saying that there is a growing price bubble. But thus far no research has been produced that would comprehensively verify this hypothesis on the basis of data from 2006-2019. This work aims to fill that gap. This is exceptionally important, because assessing the likelihood that a housing price bubble is emerging is key for the conduct of monetary and macroprudential policy in Poland. Because if we’re really dealing with growth in macroeconomic imbalances, then taking pre-emptive action to limit further price growth and prepare the economy (including the financial sector) for a potential collapse in housing prices is essential for limiting fluctuations in growth. The first problem that must be addressed in any analysis is the question of defining a price bubble, because in the literature there are various interpretations. Some say this phenomenon never happens, and others assume that price bubbles can inflate even when investors are behaving completely rationally. There are also some interpretations that are based in behavioral psychology and assume that a speculative bubble is the result of irrational, excessively optimistic expectations by buyers about future prices. Still other researchers of imbalances on the asset market don’t even get into the nature of price bubbles, defining them as excessive growth in prices to a level that can’t be maintained over the long term. For the needs of this research, I’ll adopt a hybrid definition, which brings together the conclusions of various streams in research: “A price bubble is a three-phase phenomenon that reflects growing imbalances on the asset market. While it lasts, there is relatively quick growth of prices to a level that can’t be maintained in later periods. In the first phase, the price growth is the result of changes in fundamental factors. In the second, the growth results from irrational exuberance sustained by a feedback loop. In the third, as a result of changes in fundamental factors, a relatively fast drop in asset prices occurs.” (Czerniak and Witkowski, 2016). The second problem related to determining whether we’re dealing with a price bubble or not is choosing the right tools for measurement. In the literature, many indicators have already been proposed as allowing the identification of price bubbles – from basic statistical analysis through complicated econometric and non-parametric models (ECB, 2010), including so-called early warning systems (EWS). But all of them are to a certain degree unreliable, as a statement by Visco (2005) remains valid: a price bubble can be recognized only once it bursts. That’s why it’s impossible to state with complete certainty that we’re facing this phenomenon in Poland at the moment (Gurkaynak, 2008). However, we can examine the likelihood that a bubble will develop, and assess whether the current macroeconomic and institutional situation in Poland encourage this, or the opposite. Thus, in this research I present a range of metrics of whether housing price bubbles are occurring. In the first section, I will discuss the results of applying purely statistical tools for identifying bubbles on the Polish housing market; in the second I present metrics of this phenomenon based on data concerning fundamental factors shaping housing prices in Poland. Separately, in the fourth part I will discuss access to cheap money for investment purposes. The article closes with a summary in which I juxtapose the conclusions arising from calculating various metrics of the occurrence of price bubbles on the Polish housing market. On this basis I formulate recommendations for economic policymakers, and I also propose directions for further research on this phenomenon in Poland. Polish Abstract: Rok 2019 przyniosl w Polsce dwucyfrowe wzrosty cen mieszkan i to zarowno na rynku pierwotnym, jak i na rynku wtornym. W niektorych miastach realne ceny nieruchomości mieszkaniowych osiągnely najwyzszy poziom w historii, nawet powyzej szczytu boomu z 2008 r. W rezultacie pojawily sie opinie, ze mamy do czynienia z narastaniem banki cenowej. Jednakze do tej pory nie zostaly opublikowane zadne badania, ktore w sposob kompleksowy, na podstawie dostepnych danych za lata 2006-2019 zweryfikowaly te hipoteze. Niniejsze opracowanie ma na celu uzupelnienie tej luki. Jest to niezmiernie wazne, poniewaz ocena prawdopodobienstwa narastania banki cenowej na rynku mieszkaniowym jest kluczowa z perspektywy prowadzenia polityki pienieznej i makroostroznościowej w Polsce. Jezeli bowiem faktycznie mamy do czynienia z narastaniem nierownowagi makroekonomicznej, to podjecie wyprzedzających dzialan ograniczających dalszy wzrost cen i przygotowujących gospodarke, w tym takze sektor finansowy, na ewentualne zalamanie cen na rynku mieszkaniowym, jest konieczne z punktu widzenia ograniczenia potencjalnych silnych wahan koniunktury.

L’ECONOMIA ITALIANA E LE FRATTURE DELLA GLOBALIZZAZIONE

Il documento presenta una ricostruzione sintetica delle principali tappe del processo di globalizzazione e dell'economia italiana dalla fine della seconda guerra mondiale ad oggi. Per quanto riguarda lo scenario internazionale, si individuano due chiare fratture: la fine dell'"età dell'oro" con la crisi del dollaro dell'agosto 1971 e lo shock petrolifero del 1973; la crisi finanziaria del 2007-2008, dovuta all'accumulo di gravi squilibri macroeconomici negli anni della cosiddetta "Grande Moderazione". Queste due fratture trovano una chiara corrispondenza in due analoghe fratture dello sviluppo economico italiano. L'Italia, tuttavia, presenta una terza frattura intermedia con la crisi della lira dell'agosto 1992 legata a specifiche debolezze interne; uno spartiacque per la politica economica italiana. Oggi le tensioni nei rapporti commerciali internazionali e gli impulsi populisti nei Paesi avanzati testimoniano che la crisi del 2008 è ben lungi dall'essere ricomposta nelle sue determinanti. Il documento propone un suggerimento: alla base delle dinamiche economiche degli ultimi 75 anni c'è un rapporto irrisolto tra crescita economica capitalistica ed espansione della democrazia a livello nazionale e internazionale.

The appropriateness of the macroeconomic imbalance procedure for Central and Eastern European Countries

The European Commission’s Scoreboard of Macroeconomic Imbalances is a rare case of a publicly released early warning system. It was published first time in 2012 by the European Commission as a reaction to public debt crises in Europe. So far, the Macroeconomic Imbalance Procedure takes a one-size-fits-all approach with regard to the identification of thresholds. The experience of Central and Eastern European Countries during the global financial crisis and in the resulting public debt crises has been largely different from that of other European countries. This paper looks at the appropriateness of scoreboard of the Macroeconomic Imbalances Procedure of the European Commission for this group of catching-up countries. It is shown that while some of the indicators of the scoreboard are helpful to predict crises in the region, thresholds are in most cases set too narrow since it largely disregarded the specifics of catching-up economies, in particular higher and more volatile growth rates of various macroeconomic variables.

O sentido social da ação em política monetária no Banco Central do Brasil (BCB) entre 1995 e 2017

O artigo busca demonstrar os sentidos sociais da ação na tomada de decisão da taxa básica de juros (SELIC) pelo Banco Central do Brasil (BCB).Com base na sociologia da capacidade crítica de Luc Boltanski e Laurent Thévenot, através da análise de disputas situacionais nas inflexões dos juros entre 1995 e 2017, foi possível demonstrar a influência das trajetórias sociais, das narrativas e de seu vínculo com os demonstrativos financeiros. Ficou demonstrado, também, que em conjunturas rotineiras macroeconômicas, há maiores graus de liberdade para ação com convergência de posição e tomadas de posição (no sentido de Pierre Bourdieu) em juros. Em momentos de disputas situacionais, crises políticas e desequilíbrios macroeconômicos, observou-se um aumento da influência de agentes de instituições financeiras e não financeiras (que estão do lado da inércia cognitiva econômica e moral) valendo-se de pressões performativas com base em dogmas macroeconômicos e justificações morais.

A European Minimum Wage: Implications for Poverty and Macroeconomic Imbalances

A hypothetical European Minimum Wage (MW) set at 60 percent of each country's median wage would reduce in-work poverty but have limited effects on overall poverty, as many poor households do not earn a wage near MW and higher unemployment, higher prices, and a loss of social insurance benefits may erode direct benefits. Turning to competitiveness, since the MW increase to reach the European standard would be larger in euro area countries with excessive external surpluses, the associated real appreciation should help curb existing imbalances. However, a few countries with already weak external positions would experience an undesirable real appreciation.

РОЛЬ МЕЖДУНАРОДНЫХ НЕФТЯНЫХ КОМПАНИЙ В СОЗДАНИИ НОВЫХ ЦЕНТРОВ МИРОВОЙ НЕФТЕДОБЫЧИ (НА ПРИМЕРЕ БРАЗИЛИИ)

Emergence of Brazil as a large oil exporter in the last years has become a significant development in the world oil market. The article focuses on the role played by foreign capital in development of the Brazil oil sector in the long historical perspective. The analysis led to the following conclusions. First, every time when Brazilian government was opened the oil industry for foreign investment, oil production went up with some time lag. Second, opening of the oil sector to foreign competition positively impacts the national oil company Petrobras, which plays a central role in the realization of the Brazilian government oil policy. Access to foreign investment and technology as well as competitive pressure increases the efficiency of the national oil company. Third, for decades terms of doing business for foreign companies in the Brazilian oil sector periodically changed depending on the situation in national economy. During periods of high economic dynamism Brazil introduced restrictions on activities of foreign oil companies, while with the deterioration of economic situation and aggravation in macroeconomic imbalances the government on the contrary opted for liberalization of foreign capital activity in oil production. It is concluded that in the last five – seven years the involvement of international vertically integrated oil companies in the Brazilian oil sector reached such a scale that any new attempt to complicate and impair business climate for foreign investors could result in not only economic but also political collusions.

Analysis of Ukraine public finances stability

Paper purpose is to identify the risks of public finance sustainability in the current macroeconomic imbalances in Ukraine and to identify fiscal imperatives to reduce their vulnerability caused by the budget deficit and the level of public debt. After all, public finances play an important role for securing of some economic growth, supporting of business activity, regulating of economics, solving of social problems, and creating of some right conditions for regions development. Methodology of research. Achieving this goal is based on the following research methods: dialectical approach, induction and deduction, analysis and synthesis, complex approach, logical approach, vertical and horizontal analysis, trend analysis, graphical method. Findings. In-depth analysis of the current state and tendencies of Ukraine public finances development is conducted. The main threats to the sustainability of Ukraine public finances have been identified. They are: reduction of the general level of nation economy development, critically high level of public debt, deterioration of state fiscal capacity, significant debt burden on the state budget, currency risks, speculative discount rate. Fiscal imperatives to reduce the vulnerability of public finances to factors negative impact have been identified. The theoretical and practical foundations for ensuring the sustainability of public finances have been developed. Practical value. It is proved that due to the cumulative influence of certain factors the budget imbalance increases, which leads to an expansion of state external debt. Exceeding the safe parameters of debt dependence along with currency risks growth, financial condition deterioration at the real and banking sectors in the context of financial resources chronic lack create some critically high threat to public finances, as well as the implementation of economic reforms in Ukraine. Keywords: public finances, public debt, external debt, state budget, budget deficit, debt load, international reserves. REFERENCES 1. Arhanoff, R. (2016). Derzhavni finansy v rozvynenykh ta perekhidnykh krainakh [Public finances in developed and transitional countries] ; per. z anhl. Kyiv : K.I.S. [in Ukrainian]. 2. Bazylevych, V. D., Balastryk, L. O. (2002). Derzhavni finansy [Public finances] : navch. Posibnyk (2-d, ed., rev.). Kyiv : Atika [in Ukrainian]. 3. Kudriashov, V. P. (2015). Stiikist derzhavnykh finansiv [Sustainability of public finances]. Ekonomika Ukrainy – Ukraine economy, 10, 54–67 [in Ukrainian]. 4. Monitorynh faktoriv, shcho stvoriuiut ryzyky stiikosti derzhavnykh finansiv Ukrainy [Monitoring the factors that create risks to the sustainability of Ukraine public finances] : naukovo-analitychna dopovid NAN Ukrainy. DU “In-t ekon. ta prohnozuv. NAN Ukrainy”. Kyiv [in Ukrainian]. 5. Oparin, V. (2005). Finansova systema Ukrainy (teoretyko-metodolohichni aspekty) [The financial system of Ukraine (theoretical and methodological aspects)] : monohrafiia. Kyiv : KNEU [in Ukrainian]. 6. Ofitsiinyi veb-sait Derzhavnoi sluzhby statystyky Ukrainy [The official website of Ukraine State Statistics Service]. URL: http:// www.ukrstat.gov.ua (data zvernennia: 15.10.2019) [in Ukrainian]. 7. Ofitsiynyi veb-sait Ministerstva finansiv Ukrainy [The official website of Ukraine Finance Ministry]. URL: http://www.minfin. gov.ua (data zvernennia: 15.10.2019) [in Ukrainian]. 8. Ofitsiinyi veb-sait Natsionalnoho banku Ukrainy [The official website of Ukraine National Bank]. URL: http://www.bank.gov.ua/control/uk/publish/ category (data zvernennia: 15.10.2019) [in Ukrainian]. 9. Ofitsiynyi veb-sait Rakhunkovoi Palaty Ukrainy [The official website of Ukraine Accounting Chamber]. URL: https://rp.gov.ua/Activity/Reports/ (data zvernennia: 15.10.2019) [in Ukrainian]. 10. Official site of the World Bank. URL https://data.worldbank.org/indicator/ FM.LBL. BMNY.GD.ZS?view=chart (date reviewed: 15.10.2019). 11. Rozhko, O. D. (2017). Derzhavni finansy Ukrainy: determinanty ta priorytety rozvytku [Ukraine public finances : determinants and priorities of development] : monohrafiia. Kyiv : Vydavnytstvo Lira-K [in Ukrainian]. 12. Lunina, I. O., Bulana, O. O., Frolova, N. B., at al. (2014). Rozvytok derzhavnykh finansiv Ukrainy v umovakh hlobalizatsii [Development of Ukraine public finances in globalization conditions] : kol. monohr; I. O. Lunina (Ed) ; NAN Ukrainy, DU “In-t ekon. ta prohnozuv. NAN Ukrayiny”. Kyiv [ in Ukrainian]. 13. Umanskyi, I. I. (2015). Stiikist derzhavnykh finansiv v umovakh yevrointehratsiinykh protsesiv [Public finances sustainability in the context of European integration processes]. Finansy Ukrainy – Ukraine finances, 1, 9–28 [in Ukrainian]. 14. Fedorovych, I. M. (2016). Ekonomichna otsinka borhovoi stiikosti Ukrainy [Economic evaluation of Ukraine debt stability]. Naukovi zapysky Natsionalnoho universytetu “Ostrozka akademiia”. Ser. : Ekonomika – Scientific notes of Ostroh Academy National University. Economy series, 25, 146–151 [in Ukrainian]. Published: 2020-03-28

CУЧАСНИЙ СТАН ТА ПРОБЛЕМИ ФОРМУВАННЯ ДЕРЖАВНОГО БЮДЖЕТУ В УКРАЇНІ

A significant place in the social and economic development of each country belongs to the problems of the budget, because the budget belongs to the sphere of public life that directly affects the interests of all members of society. The budget of any country reflects the important economic, social and political problems of the state and each person in particular. At the same time, the successful solution of budget problems is possible only if a proper understanding of its essence, role and place in the system of economic relations. For any country, the state budget is the main link in the financial system. As part of this system, it combines the main financial categories: income and expenditure of the country, the tax system, public credit, public debt in their closest coexistence. The budget as a financial plan of public expenditures and sources of their coverage plays an important role in the activities of the state. It determines its capabilities and development priorities, its role and forms of implementation of the functions assigned to it. It is an effective regulator of that economy reflects the amount of financial resources required by the state, determines specific areas of use of funds, directs the financial activities of the state. The peculiarity of the budget as a financial plan is that it has the force of law. The legislative nature of the budget provides appropriate conditions for monitoring the use of budget funds and strengthening its impact on the efficiency of social production. Financial imbalances as an objectively existing reality are an integral determinant of modern development, and the form of their manifestation is the crisis phenomena, which in retrospect of global development have repeatedly led to sovereign defaults. At the present stage in Ukraine the problem of analysis of factors and components of economic growth is quite acute in order to level the main macroeconomic imbalances and imbalances and stabilize further economic development. This article considers the main problems of imbalance of the state budget of Ukraine, analyzes the objective and subjective factors of revenue and expenditure of the State Budget of Ukraine. The essence of the concept of "state budget" is highlighted. The article examines the problems of imbalance of the state budget. The statistical data of expenditures and revenues of the state budget of Ukraine for 2019-2020 are analyzed. Ways to improve the balance of the state budget are proposed. It is considered that it is rather difficult to ensure equality of revenue and expenditure parts of the budget. It can be achieved if we constantly restrain the growth of government spending and establish a level of taxation in the country that will be sufficient to generate income to cover public needs. It is investigated that an important factor in the stability of the budget system is the balance of local budgets.

Аргентина: актуальная повестка новых властей

On December 10, 2019, the Peronists returned to the leadership positions in Argentina, who in 2015 lost power to the opposition led by Mauricio Macri. The opposition came to power with a promise to carry out structural reforms and on this platform to correct macroeconomic imbalances, reduce public debt, overcome isolation from world credit organizations and funds, ensure inflow into the country foreign investment, reduce the tax burden on business, curb inflation. At the same time, the roots of Argentina's current crisis date back to the economic policies of the previous period. Over the past four years, President Macri and his team have failed to address these and other economic problems, which prevented them from winning elections on 27 October 2019. This article examines the challenges facing the new President-Peronist Alberto Fernandez, and shows how the external economic agenda of the Argentine authorities can change. According to the author, the key problem of the current extremely difficult stage of the Argentine economy is that it is marked by a number of negative factors, the elimination of which requires not only prudent and accurate decisions of the executive power, but also the strain of the nation's efforts, as well as the most favorable conditions in the external financial and commodity markets. The article focuses on the state and prospects of Argentina's trade and economic ties with key partners, including the United States, China and Russia. In particular, it is stressed that Argentina has great potential as an exporter of food to the global market. During the Presidency of Macri, as part of the policy of "offensive agricultural diplomacy" the role of the country as a supplier of agricultural products, in particular, soy, wine, wheat, vegetables and fruits, meat increased significantly, were laid down "agricultural expansion" to new foreign markets. The minimum goal of the current Argentine authorities is not only not to lose the achievements of the previous government in foreign trade, but also to consolidate this important trend. Are summed up the political results of the Peronist rule.

Poreska politika i efekti oporezivanja u Republici Srbiji

In the previous period, tax policy was the topic of analysis and discussion in the wider scientific and professional public. The effects of taxation can be diametrically opposed to the objectives of taxation. The modern economy sees tax policy as the basic lever for the development of stabilization and social policy. The operation of public revenues and public expenditures, as well as public debt, have become the most powerful form of state interventionism. In developing countries, the most dominant taxes for collecting public revenues are direct taxes, while in more economically developed countries, indirect taxes are the most dominant. The aim of the research is to point out to the scientific and professional public the importance of tax policies and their effects on the economic development of the Republic of Serbia. The results of the research show that with a successful tax policy we can alleviate the macroeconomic imbalance, i.e. it would reduce the foreign trade deficit, reduce tax evasion and the gray economy. The tax system has changed significantly in the last decade, but not enough, all because of the harmonization of tax policy with the European Union.

Structural indicators to monitor macroeconomic misbalances in the investment sphere of Ukraine

The article presents the results of the author's researches on the development of forecasting and analytical tools to detect and prevent for an exposure and warning of potential macroeconomic misbalances in Ukraine taking into account the experience of European Union in the use of the Macroeconomic Imbalance Procedure (MIP). Attention is focused on the construction and monitoring of structural indicators for the investment sphere, which determine the potential for economic development; substantiated the necessity to adapt the current EU MIP component to assess the investment sphere in Ukrainian realities. The author shows that, taking into account the transitive character of Ukraine's economy, the instrumental assessment of the development trends in its investment sphere trends requires analysis of the structural changes with the use of relevant indicators. Presented the main results of the analytical assessment of the corresponding changes in the structure of gross accumulation of fixed capital, investments in fixed capital, changes in the structure of foreign direct investments and the volumes of their inflow that have been observed in recent years, and shown that Ukraine in this sense is moving opposite to progressive global trends. Despite the adoption of a number of laws on the strategy of Ukraine's economic development of Ukraine, priorities for the development of this country's productive potential, transition to an innovative path of development, etc., there are still no real progress in the investment sphere. Emphasized the need to create and implement a national policy aimed at encouraging the expansion of domestic investment opportunities, and reorientation of the interests of foreign investment capital to technological renewal of Ukrainian economy.

Macroeconomic Imbalances in the Euro Area

Macroeconomic Imbalances in the Euro Area