rss_2.0Central European Economic Journal FeedSciendo RSS Feed for Central European Economic Journal European Economic Journal Feed the Initial Export Boost: The Erosion of Trade Agreement Benefits<abstract> <title style='display:none'>Abstract</title> <p>Preferential trade agreements (PTAs) are widely acclaimed for their potential to mitigate market imperfections and expand export opportunities. However, in changing economic circumstances, these beneficial effects may only endure for a while and often gradually fade, affecting industries unevenly. This study delves into this overlooked phenomenon by exploring Poland‘s export performance in the Western Balkan (WB) region, where the implementation of Stabilization and Association Agreements (SAAs) has evidently generated export growth, primarily driven by tariff reductions, though these gains were manifested disproportionally across sectors. Employing survival analysis, the study validates the positive influence of SAAs on Polish export competitiveness within the WBs while uncovering its temporal erosion and sectoral discrepancies. On average, a 51% and 84% decline in Polish export competitiveness to WBs is observed after 5 and 10 years, respectively. Moreover, a unique dataset on non-tariff measures (NTMs) is employed to identify specific sectors encountering significant NTMs contributing to the reported diverse export patterns. These insights highlight the need for policies that acknowledge the diminishing benefits of trade agreements and mitigate the trade imbalances caused by NTMs.</p> </abstract>ARTICLEtrue Market Enlargement and Technical Barriers to Trade: Revisiting the Evidence<abstract> <title style='display:none'>Abstract</title> <p>EU enlargements have given new EU member states access to the European Single Market. While tariff liberalisation was already completed at the time of enlargement, technical regulations were subject to different sectoral approaches, including harmonisation and mutual recognition. We employ a structural gravity model estimated using sectoral trade data from 1987 to 2020 to assess the trade effects of these measures. We find that trade expansion, particularly exports of the NMS to the incumbent EU members, has been stronger in the sectors covered either by the Old Approach (full harmonisation) or the New Approach (essential requirements) than in sectors covered by mutual recognition. The New Approach has been more effective when coupled with mutual recognition at the sector level than with either approach alone. Our results imply that the TBT harmonisation has had a heterogenous impact on different sectors (the most important for low-tech industries was the Old Approach, while for high-tech, it was the New Approach).</p> </abstract>ARTICLEtrue on the Political Economy of International Trade<abstract> <title style='display:none'>Abstract</title> <p>International trade appears to be strongly dependent on the political environment and institutional arrangements. In this context, the commented strand of economics is expected to follow the relationships that can be turbulent. The paper reviews the available literature on international trade, with a particular focus on aspects of the political economy. These threads are described in the context of the past and present literature, as well as prospects for future research. Over the decades, the focus of the debate has shifted strongly. The analysed issues reflect not only current events affecting the shape of international trade, but also the availability of data or the growing range of quantitative tools. The observed progress and evolution of the political economy of international trade has brought numerous conclusions of scientific and practical importance.</p> </abstract>ARTICLEtrue Safety: A Developing Country Perspective<abstract> <title style='display:none'>Abstract</title> <p>Developing countries, trying to achieve an acceptable level of food safety at the least possible cost (efficiency objective) and facilitation of market access to the large and lucrative developed country food markets (market access objective), could follow the multilateral, regional, unilateral or the independent approach. The paper studying the pros and cons of these approaches aims to determine the most appropriate food safety reform package. It shows that the best approach is the unilateral. Under this approach the achievement of efficiency objective requires the adoption and implementation of the multilateral approach. The achievement of market access objective requires the adoption and implementation of the regulatory regime of the developed country whose markets the developing country is intending to penetrate. Instead, the paper proposes that the developing country adopts and implements the developed countries‘ regulatory regime only in agricultural sub-sectors with highest comparative advantage scores, and that in all other agricultural sub-sectors the country should adopt and implement the regulatory regime as developed by multilateral approach. Since the tasks associated with designing and implementing the food safety policy reform are challenging, the paper advocates that this task should be left to a new institution, the ‘Food Safety Council‘, which needs to be formed as an autonomous public institution with sufficient financial and technical resources.</p> </abstract>ARTICLEtrue the EU‘s Fourth Freedom Be Further Challenged by Present Members of the Single Market?<abstract> <title style='display:none'>Abstract</title> <p>The creation of a single market in Europe, conceived as the application of the so-called four freedoms (goods, services, capital and manpower) of movement was in vogue in the 1990s. What has happened to this dream? At the time not only business communities but also consumer associations, and even labour unions were all in favour of opening their national economies to the winds of continental competition. Three decades after, some national communities seem to have turned their backs on the free movement of people. The case of Eastern European immigrants settling for work in the UK after 2004 comes to mind, something which arguably was one of the main reasons for the Brexit vote in 2016. The issue could again become the focus of populist governments or parties (e.g., in Italy, France, Sweden, Austria, Hungary or The Netherlands), should the danger of an EU-wide recession or an idiosyncratic crisis in one of the poorest member states (MSs) materialize. Actually, a new intensification of intra-EU migration flows could be one of the outcomes of the unravelling of supply chains as a result of the COVID epidemic and geopolitical considerations, such as the EU’s wish to diminish trade dependence from China and Russia. The ground is slowly eroding under the feet of those adamant to cling to the free movement of people as part of the acquis. The EU Commission should give thought, before it is too late, about the fourth freedom particularly in view of future EU enlargements.</p> </abstract>ARTICLEtrue Special Edition of the Central European Economic Journal to Mark the 70 Birthday of Prof. Jan Jakub Michałek Heterogeneity and International Trade Liberalisation: A Generalized Cournot Oligopoly Approach<abstract> <title style='display:none'>Abstract</title> <p>The main goal of this article is to contribute to the theoretical analysis of international trade under imperfect competition using the Cournot oligopoly model with heterogeneous firms. In particular, our objective is to provide some insights into the role of cost asymmetry in studying the effects of trade liberalisation in the Cournot oligopoly framework. In order to introduce firm heterogeneity into the oligopoly model we use the generalised Cournot framework with asymmetric firms that differ in terms of their productivity, levels of output and market shares. We show that trade liberalisation leads to the elimination of less productive firms and results in lower equilibrium prices, higher sales per firm and lower markups in the industry.</p> </abstract>ARTICLEtrue Much Neoprotectionism is There in Contemporary World Trade?<abstract> <title style='display:none'>Abstract</title> <p>Negative effects of globalisation and liberalisation of trade are countered using protectionist measures. Contemporary protectionism, typically termed neoprotectionism, is put into practice using a wide variety of non-tariff instruments, with a considerably lesser degree of transparency compared to tariffs, which are more difficult to identify and measure. The aim of this paper is to determine the dynamics of protection, as well as the category and geographical structure for the use of trade policy instruments in the world goods trade in the years 2010–2022. The study was based on source materials from the Global Trade Alert (GTA) and the United Nations Conference on Trade and Development (UNCTAD). The conducted analyses showed that interventions taken in the world goods trade in the years 2010–2022 were primarily trade restrictions executed using non-tariff measures. In terms of its geographical distribution the relatively greatest scope of protectionism observed was for the trade policy of China and the USA. In terms of the product category, the sale of agricultural produce was protected the most. The realised model of protectionism differed depending on the group of products being traded, the standard of economic development of the country implementing trade policy measures, its export specialisation and the degree of self-sufficiency. The protectionist character of the trade policy was also enhanced during economic crises.</p> </abstract>ARTICLEtrue of TBTs on Trade in ICT Goods: Differentiating by Regulatory Objectives<abstract> <title style='display:none'>Abstract</title> <p>This paper analyses how different types of technical barriers to trade (TBTs) imposed on imports of information and communications technology (ICT) goods globally affected the value and volume of imported goods during the period of 1996–2018. Key words cited in the TBTs give an indication of the aims behind the imposition of TBTs. The results indicate that TBTs have a strong positive impact on the value of imports. While many key words cited in TBTs notified to the World Trade Organization (WTO) affect the value and volume of imports in a positive way, certain other TBTs function as trade barriers.</p> </abstract>ARTICLEtrue of management performance measures (MPMs) disclosed in primary financial statements prepared in accordance with new standard planned to supersede IAS 1<abstract> <title style='display:none'>Abstract</title> <p>We outline the management performance measures (MPMs)' boundaries based on the upcoming introduction of MPM's definition to International Financial Reporting Standards (IFRS). The literature investigates business performance measures concentrating on managers' needs, while IFRS aims to provide financial information to external users who provide resources to the entity. This indicates a gap between how performance metrics have been investigated so far and how IFRS will adopt them. We used analysis of the exposure draft of the planned standard together with working materials developed in the consultation process. Further, a case study is presented. Results show that the scope of MPM to be introduced to IFRS is limited compared to the broad spectrum of performance measures presented in the literature. We contribute by showing the avenues for future performance measures research using signalling and agency theory and by indicating the limited scope of MPMs and thus bound prospects for using them for a full assessment of the entity‘s performance.</p> </abstract>ARTICLEtrue rules as institutional tools for public debt management in the European Union Member States<abstract> <title style='display:none'>Abstract</title> <p>This paper aims to assess the impact of the second-generation numerical fiscal rules on the effectiveness of public debt management in the Member States of the European Union. The research was conducted using dynamic panel models on a sample of 27 EU Member States over the period 2008–2021. The effectiveness of public debt management was determined by the level of public debt servicing costs, considering not only the impact of the quality of numerical fiscal rules on interest payments, but also other factors influenced by these rules, such as the quality of fiscal policy, the solvency of public finances and the quality of institutional governance. The motivation for this topic was to evaluate the effectiveness of the second-generation numerical fiscal rules following the changes made to their design in the context of the reconstruction of the EU fiscal surveillance system after the global economic and financial crisis of 2008–2010. The research has found that strong numerical fiscal rules improve the effectiveness of public debt management. In addition, stable fiscal policy and higher solvency of public finances, as well as political stability and the absence of violence, are conducive to lower public debt servicing costs. This paper enriches the literature by extending it with a new approach to fiscal rules, highlighting their multifaceted impact on the quality of public debt management.</p> </abstract>ARTICLEtrue of Public Transportation on European Countries’ Development: a Spatial Perspective<abstract> <title style='display:none'>Abstract</title> <p>Sustainability is a key topic nowadays, mostly because in the last decade the pollution levels have reached an all-time high. National governments are searching for sustainable and environmentally friendly solutions to decrease the amount of pollution. This study is a cross-sectional study on 27 European countries, using data gathered in 2020. This study's main goal is to show the environmental sustainability of public transportation and its impact on country development in Europe. The methodology used in this study will consist of spatial econometrics methods with visual maps and graphs to help with a better visual representation of the phenomena presented. The empirical evidence will be confirmed by the spatial regression's results. Because the spatial diagnostic tests revealed that the spatial processes are present in terms of both spatial lag and spatial errors, the model that was used was a Spatial Autoregressive Moving Average Model (SARMA). Moreover, the environmental sustainability of public transport is also a significant factor. The expected results from which this study began – specifically, that the spatiality has a significant impact in modelling the relationship between public transportation and economic development – were confirmed.</p> </abstract>ARTICLEtrue of Regions in Selected Countries of Central and Eastern Europe<abstract> <title style='display:none'>Abstract</title> <p>Creating the competitiveness of voivodeships is a difficult and complicated process; the effect is a specific competitive position against the background of compared regions. This study complements the literature on the subject and presents a new perspective that presents a fuller and more comprehensive range of determinants influencing the level of competitiveness of territorial units, thanks to the use of the components of the European Regional Competitiveness Index (RCI) and the European Social Progress Index (EU SPI). The study carried out a comparative analysis of the RCI and the EU SPI of territorial units of Central and Eastern Europe in 2016–2020, and as a supplement to the cluster analysis, used the Ward method. The research results prove that territorial units in Central and Eastern Europe were characterized by a lower level of competitiveness and social progress compared to regions in Northwestern Europe. Between the regions of countries of Central and Eastern Europe, there was also a visible spatial differentiation of competitiveness between individual units. Cluster analysis facilitated the selection of regions and the identification of units that were internally and homogeneously consistent. This made it possible to select leaders among the regions of the above-mentioned regions. countries with a relatively high competitive position compared to the others, including the regions of the Czech Republic and Poland.</p> </abstract>ARTICLEtrue a better understanding of self-selection to teacher training programmes: A case study of a renowned public university in Poland<abstract> <title style='display:none'>Abstract</title> <p>It is difficult to achieve high-quality education without good teachers. Therefore, it is crucial to understand who decides to become a teacher. This study leverages a large-scale administrative dataset comprising detailed records of the educational trajectories of 10 cohorts of students at the University of Warsaw, the largest higher education institution in Poland, in order to investigate self-selection to the teaching profession and to learn whether it depends on the mode of teacher training and the student's primary field of studies. We find that the recruitment of students to the concurrent teacher training programme is characterised by adverse self-selection with respect to prior academic achievements. When it comes to consecutive programmes, pursued as an extension or specialisation within the major programme, the willingness of students to enroll in teacher training is related to their secondary school achievements, but also – and in a distinct way – to their early experience at the university. In the case of STEM and foreign language programmes, we observe adverse selection to teacher training with respect to either the student's pre-university academic outcomes or their achievements during the first year of university studies.</p> </abstract>ARTICLEtrue behavior towards the circular economy<abstract> <title style='display:none'>Abstract</title> <p>The article focuses on the consumption of goods used by consumers of different generations from 3 different countries: Albania, Polish and Portugal. The aim of the analysis was to identify respondents‘ indications concerning: (1) knowledge of the definition of the circular economy, (2) declared by respondents places of purchase of used products and (3) type of purchased products used by respondents. The analysis was conducted among 495 respondents from Albania, Polish and Portugal representing three generations (X, Y, Z). Correspondence analysis was used for statistical data analysis. Statistically significant differences in knowledge of the definition of the circular economy were shown between respondents from Albania, Polish and Portugal. It was also found that respondents‘ preferences regarding the place of purchase of second-hand goods are differentiated (at a statistically significant level) by nationality and year of birth (generation). The obtained results open the possibility of further research aimed at identifying different behaviors among these groups of consumers. The presented work, both in the cognitive and application part, can be a source of knowledge and popularization of research, as well as a source of inspiration for in-depth reflection and scientific discussion. The analyses presented in the publication may complement the existing research in the field of circular economy. Extending the survey to other EU countries can help define a strategy for policymakers, manufacturers and retailers to make greater use of circular economy solutions, while maintaining the viability of their operations.</p> </abstract>ARTICLEtrue forecasts? Keep it simple<abstract> <title style='display:none'>Abstract</title> <p>This study contrasts GARCH models with diverse combined forecast techniques for Commodities Value at Risk (VaR) modeling, aiming to enhance accuracy and provide novel insights. Employing daily returns data from 2000 to 2020 for gold, silver, oil, gas, and copper, various combination methods are evaluated using the Model Confidence Set (MCS) procedure.</p> <p>Results show individual models excel in forecasting VaR at a 0.975 confidence level, while combined methods outperform at 0.99 confidence. Especially during high uncertainty, as during COVID-19, combined forecasts prove more effective. Surprisingly, simple methods such as mean or lowest VaR yield optimal results, highlighting their efficacy. This study contributes by offering a broad comparison of forecasting methods, covering a substantial period, and dissecting crisis and prosperity phases. This advances understanding in financial forecasting, benefiting both academia and practitioners.</p> </abstract>ARTICLEtrue Unpredicted Rise of Populism: The Case of Poland<abstract> <title style='display:none'>Abstract</title> <p>This article investigates the rise of populism in Poland, applying an interdisciplinary method, with political, social, and economic factors as the compound reason for the turn from liberalism towards populism. The methodology of the study is the exploratory analysis of research, historical materials on Poland's transition to capitalism, and calculation of the selected empirical data of household incomes, linked to election results, in the regional cross-section. The household economic condition was validated by a report on deprivation and the presented growth of households’ disposable income, exposing regional differences between the selected voivodeships. The populist party Law and Justice (PiS) won the two last elections, with the majority of votes in low-income regions, which proved the hypothesis that economic inequality, amplified by globalisation and transition disparities were the main reasons for populism's prevalence. The democratic backsliding has not changed party-political scenery for very long, which revealed that for the majority of Polish voters, economic upgrading counted more, despite the violation of democracy. Therefore, the advance of knowledge about measures to reduce the in-country socioeconomic disparities between regions has become more important.</p> </abstract>ARTICLEtrue Determinants of Credit Risk on the Example of Non-performing Loans<abstract> <title style='display:none'>Abstract</title> <p>The primary goal of this article is to examine the principal macroeconomic factors influencing credit risk as assessed by the nonperforming loan ratio (hereinafter NPL ratio). Based on the results, the ratio of domestic credit to the private sector, Organization for Economic Cooperation and Development (OECD) membership with a negative correlation with NPLs while the unemployment rate and the ratio of public debt with a positive relation with NPLs were statistically significant. In addition, the correlation between the inflation rate and the depreciation of the home currency was proven.</p> <p>The research examines the effects of the 2008 credit crunch, which triggered the financial crisis. The sample comprises 106 countries for the period 2009–2019. The real GDP growth, unemployment rate, public debt ratio, domestic credit to private sector ratio, currency depreciation, inflation rate, and interest rate were analysed as macroeconomic factors. A dummy variable representing OECD membership has been included in the analysis. The estimations were performed using the ordinary least squares (OLS) method.</p> <p>This article contributes to the academic discourse on the panel data perspective with regard to non-performing loans, while the practical implications are beneficial for governments and international investors.</p> </abstract>ARTICLEtrue bonds - financial innovation for sustainability financing: The case of the Polish green bonds market and their development barriers<abstract> <title style='display:none'>Abstract</title> <p>The struggle against climate change and the increasing implementation of sustainability and environmental, social and governance (ESG) standards have contributed to the dynamic development of green finance. Green bonds have become one of the key tools of green finance. The aim of this paper is to provide a comprehensive study related to the development and barriers of the green bonds market in Poland. A literature review, comparative analysis, and financial data were used in this research. The publication uses data from the Climate Bonds Initiative and includes global data on the development of the green bond market. The research was also enhanced by data from the Polish Ministry of Finance. Green bonds are an increasingly popular financing tool for renewable energy, zero-emission transport, or green buildings. The biggest advantages of green bonds are compliance with ESG standards, hedging of climate risk, and reputational benefits. Disadvantages include significant transaction costs, lack of uniform standardisation, or the risk of greenwashing – particularly when issuing sustainability-linked bonds. The development of green bonds in Poland faces barriers related to the lack of green projects. The development of municipal green bonds in Poland is clearly hampered by high transaction costs and the lack of clear economic benefits for issuers. Green bonds are not an instrument to finance all environmental investments, hence their implementation is limited; however, they are playing an increasingly important role in the transition towards sustainability.</p> </abstract>ARTICLEtrue Relationship between Fertility and Female Participation in the Labour Force in OECD Countries 2000–2020: It Is (Again) Negative<abstract> <title style='display:none'>Abstract</title> <p>The cross-sectional association between female labour force participation rates and fertility in developed countries shifted from negative to positive during the 1980s. Ever since then, researchers have applied different statistical approaches; therefore, the present study re-evaluates the results by applying a distinct strategy to the data from 2000 to 2020 for 32 countries belonging to the Organization for Economic Co-operation and Development (OECD). Specifically, the data analysis discussed here implemented the so-called „unified“ model, thereby extending the analysis beyond the limitations of the fixed effects (FE) method; namely, by decomposing coefficients within (time-series) and between (cross-sectional) countries‘ effects, the study increased the explanatory power of our statistical model on the relation between fertility level and female labour force participation rate. Eventually, the selected statistical approach has shown the potential to offer a better interpretation of results in comparison to previous studies. Finally, this study confirmed the persistence of a negative trend in a time-series association between labour force participation and fertility.</p> </abstract>ARTICLEtrue