Economic Policy Strategies Research Articles

Explaining the Euro crisis: current account imbalances, credit booms and economic policy in different economic paradigms

The paper proposes a post-Keynesian analysis of the Eurozone crisis and contrasts interpretations inspired by New Keynesian, New Classical, and Marxist theories. We analyze the role different paradigms attribute to current account imbalances, fiscal policy and monetary policy. Remarkably, opposing views on the relative importance of cost and demand developments in explaining current account imbalances can be found in both heterodox and orthodox economics. Regarding the assessment of fiscal and monetary policy there is a clearer polarization, with heterodox analysis regarding austerity as unhelpful and large parts of orthodox economics endorsing it. We conclude that there is a weak mapping between post-Keynesian, New Classical, New Keynesian and Marxist theories and different economic policy strategies for the Euro area, which we label Keynesian New Deal, European Orthodoxy, Moderate Reform and Progressive Exit respectively.

Globalization and Developing Economy: Evidence from Nigeria

The paper essentially interrogates the question as to whether globalization has promoted economic growth in Nigeria in line with the ambitious expectations of the promoters of the concept especially, the World Bank and the International Monetary Fund. The article both clarifies and demystifies the recentness of the phenomenon usually foisted on the mind, by beaming a search light through its evolutionary path. Evidences from literature were examined for a clue for a support of economic growth hypothesis in the particular instance of a local economy, Nigeria. It was found that whereas globalization may have improved the economies of advanced democracies, the domestic economy received marginal benefits but in the main was undermined owing to a host of factors including, weak technical base, unhealthy macro-economic environment and poorly diversified economic base. This has rendered her a net loser in the competitive struggle engendered by globalization. The paper recommends economic policy strategies that not only diversify her economic investments but allow her to selectively engage the world in a way that protects the investments of locals from undue competition from unregulated globalization.

Strategic Approach to State Regional Economic Policy in Ukraine

Under modern conditions, there is a need to update the state regional economic policy in Ukraine. Problems of the social and economic development in Ukraine explains the need to pay attention to implementation of state regional economic policy in Ukraine. Scientific and theoretical bases of state regional economic policy have been a point of many researches made by scientists. However, lots of theoretical issues on the essence of strategic approach to state regional economic policy are not fully researched. The state regional economic policy of Ukraine has been investigated. State regional economic policy is a purposeful activity of the state in economics at regional level directed at the stimulation of effective development of productive forces of regions, rational usage of resources, providing optimal conditions for the population vital activity, ecological security and advancement of territorial organization of population. The features of implementation of state regional economic policy in Ukraine are being investigated. The success of regional policy depends on the apt definition of the regions, criteria of their development, level of their correspondence to the administrative and territorial arrangement of the state. For practical realization of the policy, it is necessary to form and advance the relevant mechanism. The algorithm of forming the conception of strategy of state regional economic policy is considered in Ukraine. Goals of the state regional economic policy in Ukraine are generalized. Under today’s conditions, the state of regional social and economic development requires the improvement of forming and implementation of state regional economic policy in Ukraine. Conceptual bases for strategy of state regional economic policy in Ukraine are developed.

Современная трансформация мировой системы экономических отношений и направления обеспечения экономической безопасности России

The article taking into account the identified vectors of modern transformation of the world system of economic relations identifies and describes the main risks and threats that this transformation brings to the national economic security of our country. Special attention is paid to the geo-economic interests of China, which claims global leadership. China’s claims to leadership have also been shown to pose threats to Russia ‘s economic security. The author justifies the position that sanctions against Russia are only one of the elements of global transformation, so the country’s economic policy and national strategy to ensure Russia ‘s economic security should be oriented towards adapting to the transformation considered, rather than countering sanctions, which are only a private manifestation of the transformation.

Actions Speak Louder than Words: China’s Consultative Peacekeeping in Africa

Existing concepts (e.g. ‘non-interference’ and ‘pragmatism’) remain too vague to provide explanations for China’s increasingly assertive security policy. To avoid this pitfall, this article adopts a narrower focus on Chinese security policy towards Africa. It explores two contrasting cases, namely Sudan/South Sudan and Mali to demonstrate that China: a) pursues security engagement only after obtaining permission by relevant parties (UN; regional organizations; target state); b) favours peacekeeping (stability) over peacebuilding (arbitrary support for emerging regimes); c) strategically interweaves its economic goals and security policy strategy. The article thus re-conceptualizes China’s new security policy towards Africa as ‘consultative peacekeeping.’

Flexibilización del modelo de insumo-producto para determinar interdependencias productivas en la ciudad fronteriza de Reynosa, Tamaulipas, 2013

Con información económica del año 2013, se sugieren estrategias de política económica regional para el municipio fronterizo de Reynosa, Tamaulipas. A partir de los modelos de Leontief y Flegg, Webber y Elliot, se construye una matriz de insumo-producto regional y su correspondiente análisis de multiplicadores. Para complementar el procedimiento, se tipifica la influencia de la actividad industrial y se brinda una visión estructural de los encadenamientos productivos siguiendo a Rasmussen. Los resultados muestran el carácter marginal de los multiplicadores de producción, empleo, remuneración de los asalariados y valor agregado en las actividades productivas no manufactureras.

Структурная модернизация как основа прогрессивного и безопасного социально-экономического развития российской экономики

Objective: to determine the impact of economy structure on the progressive and safe socio-economic development of national economic systems.Methods: the methodological basis of the study was the scientific research of the relationship between structural changes in the economy, the level of development and socio-economic policy of states, as well as their position in the system of world economic relations. The specific methods used were the method of theoretical cognition, the methods of observation, generalization, comparative analysis, data grouping, and analogy.Results: under mobility of the external environment at the state level, one of the urgent tasks is to find the most effective model of economy. In Russia, the objective need for progressive upward development is due to technological backwardness and the increased vulnerability to the economic challenges of our time. It is determined that one of the key conditions for the upward economic development is to increase the technological level in the country. It emphasizes the need to move from the predominance of reproductive system to a vertically integrated system of inter-industry production chains. It is indicated that the development of a market economy is associated with a number of challenges that threaten such development, including the reduction of economic sovereignty of countries as a result of the predominance of individual economies. This determines the need to consider the upward development of the country’s economy through the prism of economic security. Based on the analysis of economic literature and statistical data, it is proved that the economy structure is a factor, indicator and condition of the upward movement of national economic systems. The upward movement of national economic systems, in turn, is seen through the prism of progressive and safe socio-economic development as an objective requirement of modern reality, achieving of which is determined by the structural changes in the economy. In this regard, it is proved that it is necessary to ensure the structural modernization of the Russian economy as the basis of its progressive and safe development.Scientific novelty: consideration of the upward movement of national economic systems through the prism of progressive and safe socio-economic development, which, in turn, is achieved through the modernization of the economy structure. Practical significance: the main provisions and conclusions can be used in the development of the foundations of the state economic policy and state strategies of socio-economic development of the national economy in the future.

The limitations of entrepreneurship development in Bosnia and Herzegovina with special emphasis on tax regulations and procedures

Small and medium-sized enterprises account for over 99% of active businesses in Bosnia and Herzegovina, and face a number of limitations when performing their business activities. A number of those limitations relate to the nature of small and medium-sized enterprises, but most are due to the inadequate legal and regulatory framework for doing business. A disincentivised business environment and lack of a unified economic policy and sector strategies further complicate the position of small and medium-sized enterprises. The aim of this paper is to show the limitations faced by these companies. To this end, an investigation involving 119 small and medium-sized enterprises in Bosnia and Herzegovina was conducted. Convenience sampling was used in the research. Based on the survey, it is evident that respondents rated the tax burden factor (the tax structure and taxation process) the most problematic. This finding corresponds with Doing Business' 2019 survey results. A section of this paper is devoted to the fiscal aspect of doing business: tax regulations and the overall tax burden and taxation procedures. It shows that the magnitude of the fiscal burden, the complexity of tax regulations and the inconsistency and complexity of the taxation system are a significant burden on small and medium-sized enterprises. The paper concludes with recommendations for more efficient and simpler tax regulation.

Regional Tax Externality and Competition: Empirical Study in Early Decentralization Era of East Java Province

<p>This paper concerned with the empirical study about tax competition among regions which in a theoretical point of view, tax competition is seen as an economic policy strategy to attract mobile tax bases and firms in order to boost economic development in terms of employment and output growth within the political jurisdiction implementing it. Using a panel of more 400 observed district and municipal inEast Java. It provides empirical evidence on how the local tax as well as the retribution in the neighborhood affect the local tax. The results support the existence of fiscal externalities: an increase in the tax and retribution of local neighbors exerts a positive effect on the local tax which is shown by spatial weighting variable both tax and retribution. Several factors that are hypothesized affect local tax also significant to determine local tax, these factors such as original regional income, and regional domestic product as a proxy of income.</p><p> </p>

Climatic variability and thermal stress in Pakistan’s rice and wheat systems: A stochastic frontier and quantile regression analysis of economic efficiency

South Asia is the world’s most poverty-dense region, where climate change and climate variability are expected to result in increased heat stress and erratic precipitation patterns that affect agricultural productivity. Considerable evidence has been generated on the effects of these stresses on crop yield, though previous research has not yet examined their influence on the economic efficiency of cereal producers. Surveying 240 farmers across eight of Pakistan’s twelve agro-ecological zones, we examined the impact of temperature and precipitation anomalies – as indicators of climatic variability – and the number of days when temperature exceeds crop specific heat stress thresholds on the economic efficiency of rice and wheat production. To this end, we employed first-stage stochastic production frontier (SPF) models and second-stage ordinary least square (OLS) and quantile regression models. Both OLS and quantile regressions indicated that terminal heat >34 °C has a significant negative impact on wheat production economic efficiency. Small positive deviation (0.54 °C ± 0.16 SD) of the wheat season’s mean temperature from the medium-term historical mean also significantly and negatively affected economic efficiency across all regression models. Heat stress >35.5 °C during rice flowering in the monsoon also had a significant and negative impact. A slight positive deviation in temperature averaging 0.38 °C (±0.11 SD) above the medium-term mean also had significant negative effects across all regressions. Cumulative precipitation conversely had significant yet contrary effects, by offsetting farmers’ investment in supplementary irrigation and increasing economic efficiency. Our results highlight the fact that indicators of climatic variability and heat stress negatively affect the economic efficiency of both rice and wheat producing farmers. Farmers’ education and access to financial and extension services were however both positively associated with economic efficiency. Our findings point to the importance of developing interlinked agronomic, economic and socio-ecological policy strategies to adapt and increase the resilience of Pakistan’s cereal systems to climatic variability.

Implication of better economic conditions

There is no economic growth and development where there is no clear economic policy and development strategy, that is where there are no defined priorities, nor mechanisms for a strong and systematic support to the domestic economy. The author of this study advises economic policy makers to forget the mantras of neoliberal policies that previous governments used as an excuse not to take anything and to resolutely turn their own economic development and building a strong industrial sector. That would be a shortcut to rapid economic development and bridging the decades of stalemate and stagnation. Serbia does not lack resourcefulness, but quality state apparatus, as well as guidance and assistance in the way that countries that have successfully developed did. The greatest sin of our economic policy in the last quarter of a century is a tragic neglect of industry, especially manufacturing, or as a result of all this, and the emergence of a deep ravine between production and consumption, and totally neglecting technological development. Therefore, we are firm in the belief that, in the case of seriously disturbed the economic structure of production at the expense of our future development must rely on priorities, among which would be the development of the manufacturing sector of the economy, and within it of agriculture and food industry, where our chances are objective and greatest. .

Foreign Direct Investment Policy and Development in Bolivia under Morales

Since 2006, Bolivia has made major changes to its economic policy and development strategy, especially with regard to the treatment of foreign capital. Analysis of the change in foreign direct investment policy as applied to the oil and gas industry reveals that it has produced greater state involvement in and control of oil revenues but no great strides in gas investment, production, or industrialization. This result contributes to the current debate on whether foreign direct investment policy is the best means of development for resource-rich countries. Desde 2006, Bolivia ha implementado grandes cambios en su política económica y sus estrategias de desarrollo, especialmente con relación al trato del capital extranjero. El análisis del cambio en la política sobre la inversión extranjera directa en la industria del petróleo y el gas revela que esa nueva política ha producido una mayor participación del estado en ese sector y un mayor control de los ingresos del petróleo pero no grandes avances en la inversión, producción e industrialización de esos recursos. Este resultado contribuye grandemente al debate actual sobre si la política sobre la inversión extranjera directa es el mejor medio de desarrollo para los países ricos en recursos naturales.

Market Reactions to ECB Policy Innovations: A Cross-Country Analysis

Financial markets behaviour has increasingly become a reason of concern for the regulators worldwide. Hence, it becomes crucial for Central Bankers to be able to exert a certain degree of control on them. Through a dynamic assessment of the main Eurozone equity markets reaction to policy rate shifts, conducted applying an event study methodology, we aim to assess whether the ECB, with its conventional monetary policy manoeuvres, is able to wield a homogeneous effect across the main Eurozone equity markets. The empirical analysis shows that generally policy rate shifts affect unevenly the Eurozone financial indexes, and, hence, are bound to generate asymmetries that reflect on the real economy. This calls for a refinement of ECB conduct and for a thorough revision of the whole European economic policy strategy.

Валютна політика України: чверть сторіччя невизначеності

The article deals with the basic elements of the exchange policy during Ukraine's independence – including monetary sovereignty, the degree of currency convertibility, the exchange rate regime, the exchange control mechanism and cooperation with the international monetary fund. The author provides a detailed analysis of the problem of selecting the appropriate direction of the exchange policy and points to the continuing uncertainty about this choice, and hence the lack of efficiency of the exchange policy in general. Ukrainian practice makes you pay attention to such a characteristic of the exchange policy as its focus on the own currency, i.e. the introduction of legal rules governing the relationship arising through use of the national currency in the currency operations (foreign exchange transactions between residents and within non-residents). Given this, the exchange policy should be formed on the basis of the principles adopted in other areas of the economic policy in order to ensure the integrity of a strategic approach to achieve the goals of a comprehensive economic policy (including exchange relations). The exchange policy should provide coordination and reasonable relationship of different components of the economic policy, in both internal and external areas, including the distinct interaction between national and international institutions of the monetary regulation. Only the presence and the use of the above analytical framework of monetary policy – in the form of professionally prepared and politically coherent laws, concepts, strategies and action programs in various fields of economy and policies – could provide certainty, consistency and effectiveness of the state monetary policy. Unfortunately, Ukraine was forced to implement its exchange policy in the absence of almost all previous conditions, which caused the uncertainty of the state monetary policy as regards its key elements, such as a general orientation (goal), the degree of currency convertibility, the exchange rate regime, foreign exchange market and currency control institutions. In addition, the most negative way on the foreign policy reflected the general uncertainty about the economic policy and overall strategy for economic development. Such uncertainty caused a chain reaction of uncertainty as to some important elements of the exchange policy.

Public Debt, Public Investment and Economic Growth in Mexico

The primary objective of this article is to answer the following two research questions: has the growing public debt of state governments promoted increased public investment? If the answer is yes, then does any increase in public investment lead to more growth in the Mexican states? Dynamic Models of panel data and the Generalized Method of Moments, with information for 32 states from 1993 to 2012, were used for this purpose. The econometric results confirmed that public debt is positively correlated with public investment and that this in turn generates economic growth. This does not mean that a good economic policy strategy has been followed, since the marginal positive impact of public investment, and therefore the public debt on the production per person, is reduced (1% increase in the interaction between public investment and public debt variable causes a 0.0005% increase in economic growth). This suggests deviations from the debt contracted for purposes other than production, which could lead to a situation of unsustainability of state public finances in the medium term.

Privatisation and Investment Activity in the Tourism of the Republic of Serbia

Abstract As other countries of Central and Southeastern Europe, the Republic of Serbia at the end of the 20th and the beginning of the 21st century entered the process of universal transformation, which in essence represented a powerful political and economic movement for thorough changes in all parts of social and economic life. The central place in total transformational processes was taken by property, that is ownership transformation. The purpose of this research are numerous changes and the effects caused by the ownership transformation, that is privatisation in all economic activities, and in tourism as well. The research methods used in this paper are: analysis method, synthesis method, abstraction method, generalisation method, comparison method, as well as mathematical and statistical methods. The research results show that the effects of the privatisation in the tourism activities of Serbia are rather devastating. Besides, there were no necessary changes in other elements of business transformation (organisational, managerial, personnel, technological and other), what is the decrease in quality of tourist offer in Serbia and its bad position on the international tourism market. Taking into account that the Republic of Serbia has included the development of tourism amongst the priorities of its actual economic policy and development strategy, results of this research should by its originality, scientific approach to the subject of the research, quality and expertise, complete research material in this scientific field, also to point out new possibilities of Serbian tourism development to creators of economic, touristic and investment politics.

Factor analyses for economic growth in EU-28 and MENA-4 countries

This study uses eight main different statistical fields, as components between 2005-2014. The following step of the research is that the factor analyses, when in case of the first FACT1 three variances of the first component are, namely GDPVol2014, UnEmploy2014 and RisPov2014 are compared with two variances of the second component, namely GovDebt2014 and SocProt2014. In the second FACT2 analyse three variances of the first component, namely GDPVol2014, UnEmploy2014 and RisPov2014 are compared with two variances of the third component, namely LLeam2014 and GDPcap2014. The cluster analyse system separates the EU-28 member states and shows how these countries are closed by their special performance. The biggest group includes 22 member states closed to each other in field of their economic performance. The biggest country group originally also can be separated into 10 smaller country-group. The second country-group was consisting of two member states, namely France and Portugal, which countries were connected by mostly similarly economic growth rate with different economic developed levels. The third country-group included Spain, Cyprus, Greece and Ireland, where the low economic growth and low level of GDP volume growth were closed in case of Spain and Cyprus, but in Greece the unemployment rate was so highly and Ireland realised highly strong GovDebt2014 and SocProt2014 in its economic performance with low level for GDPVol2014 and GDPcap2014. The factor analyses and dendrogram system can show the clear selection methods for the economies, which help the researchers and policy makers to create the economic policy strategy and financial support for those countries which have the biggest backwardness in their economic development.

An Unassailable Fortress? Neo-Liberalism in Estonia

Though its economy is tiny, Estonia has occupied a central role in the European debate about the merits of neo-liberalism. Ever since its transition to a market economy the country has pursued consistently neo-liberal strategies. Advocates of neo-liberalism argue that the country has fared very well in doing so and should serve as a model for other countries, especially those in crisis ridden Southern Europe. Critics instead argue that overall economic success has been modest while the chosen strategy has incurred substantial social costs. Moreover, much of its success should be attributed to factors other than it neo-liberal policies. The current paper tries to assess the merits of neoliberal policies in Estonia and the reasons for their resilience. It first traces the main economic policy strategies since independence to clarify to what extent its neoliberal reputation is justified. The next section looks at the economic and social outcomes of such policies. Though overall economic performance has lagged behind expectations and poverty and income inequality are relatively high, no serious challenge to neo-liberal policies has even been mounted. Though in part this is due linguistic cleavages which have divided the potential opposition, and the presence of a safety valve in the form of labour migration to the more prosperous Nordic economies, the main reason for the resilience of neoliberal- ism in Estonia is the absence of any credible alternative for a small and highly open economy in combination with the increase in prosperity significant sections of the population have experienced.

Стратегічні імперативи формування зовнішньоекономічної політики України

Глибокого переосмислення і ретельної розробки потребує генеральний план розвитку державного управління у сфері зовнішньоекономічних процесів – стратегія формування та реалізації зовнішньоекономічної політики України. Сформований в умовах політичної і економічної кризи, він залишається не націленим на забезпечення якісних перетворень – інноваційного розвитку, активізації інвестування національного бізнесу, вирівнювання асиметрії зовнішньоторговельного балансу, оптимізації структури імпорту, підвищення конкурентоздатності українських товарів тощо. Потрібні суттєві зміни в державних механізмах регулювання трансформаційних процесів, їхнє системне оновлення, осмислений перехід до такої моделі ринкових трансформацій, де саморегулювання поєднується з ефективним державним управлінням. Мета статті полягає у вивченні стратегічних засад формування зовнішньоекономічної політики держави, визначенні напрямів формування зовнішньоекономічної стратегії України та шляхів підвищення її ефективності. Сьогодні в Україні потребують логічнопослідовного застосування основні моделі стратегії формування і реалізації зовнішньоекономічної політики: стратегія протекціонізму, стратегія конкурентоспроможності і зовнішньоекономічна інтеграційна стратегія. Масштабність та розпорошеність завдань не дозволяє їх виконати в повному обсязі. Для цілеспрямованого й ефективного державного впливу на економіку країни пропонуємо будувати стратегію зовнішньоекономічної політики на принципах системності, цілісності, комплексності, субординації, спадкоємності, динамічності, системотвірних відносин.

Implementing the National Development Plan? Lessons from Co-ordinating Grand Economic Policies in South Africa

The formulation of grand economic policy strategies to promote growth, job creation, and industrial development has been a regular feature in South Africa's democratic transformation. The National Development Plan (NDP) is the latest in a line of such strategies dating back to the Reconstruction and Development Programme in 1994. While the creation of these strategies at various points in the country's transition has been indicative of the state's commitment to economic progress, implementing this commitment has been severely tested by the locus of authority, cohesion among and capacity of state institutions. In this paper, we critically examine the institutional arrangements behind the implementation of grand economic policy strategies in South Africa, observe how these produced variable implementation effectiveness across these initiatives, and consider the lessons for the implementation of the NDP. We will specifically focus on how ‘co-ordination’ was configured through the institutional arrangements, and look at how this shaped implementation.