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Mariusz Maziarz

Abstract

The paper aims to develop our understanding of the processes and mechanisms leading to economic instability. The research design and methods: the paper employs a simple game-theoretic model aimed at depicting why the mechanism connecting nonmaterial motivation of managers and the propensity of economic systems is unstable. The findings are as follows: managers, driven by the nonmaterial value of work, choose strategies that maximize the likelihood of prolonging their employment. Shortsighted CEOs may prefer strategies that offer smooth returns and an unlikely “catastrophic event.” If the unification of strategies occurs, the situation leads to a crisis and recession in the long run. The model put forth in this paper is shown to resemble the mechanism of the 2007-2008 financial crisis.

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Roger Alejandro Banegas Rivero, Marco Alberto Núñez Ramírez and Sacnicté Valdez del Ríoe

Abstract

In this paper, we evaluate and quantify the role of the discretion of the monetary policy in an open small and open economy (the case of Bolivia). The results suggest that conventional instruments of the Central Bank respond in different ways: interest rates present a sensitive/elastic response to output gap (actual economic cycle) [1.8]; an inelastic mechanism to inflation [0.5]. On the other hand, open market operations in the Central Bank responds elastically to inflation [1.2] and insensible to the output gap. These results are robust to alternative specification utilizing the Generalized Method of moments (GMM), for the quarterly period from 2000(T1)-2015(T4).

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Mykolas Navickas, Vytautas Juščius and Valentinas Navickas

Abstract

In this article the relationship between shadow economy and its’ determinants has been examined. Ten Eastern countries from European Union were chosen due to specific particularities, which may cause higher shadow economy levels in the investigated countries compared with the EU average. Time span of 2003-2016 was selected, as 2017 data has yet to be released at the time of the analysis. Article consists of examination of the current situation and shadow economy trends in Eastern European countries; overview of shadow economy scientific literature followed by hypothesis, which are examined by constructing regression models. Models aim to distinguish the relationship between selected determinants and shadow economy size. Scientific literature analysis revealed that increase of tax burden on labor is seen as a primary reason for the increase of shadow economy, however, such relation has not been identified. Furthermore, results show that unemployment and self-employed people ratio affect shadow economy insignificantly. This suggests that further analysis is needed. Nonetheless, regression model has not rejected the hypotheses of corruption level, income inequality, business freedom and GDP per capita effect on shadow economy. Thus, it can be stated that these variables are determinants of shadow economy in Eastern European countries.

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Veronika Fenyves, Elvira Böcskei, Zoltán Bács, Zoltán Zéman and Tibor Tarnóczi

Abstract

The main aim of the study to examine the extent to which the companies of a specific Hungarian sector fulfil their obligation to provide information in their notes to the financial statements as stipulated by the Accounting Act. Accordingly, it should be examined whether the notes to financial statements contains the required data regarding the balance sheets of companies investigated. For the analyses, it was used the notes to the financial statement of 8,226 companies with Hungarian headquarters, which are regulated by the Hungarian Accounting Act and which have information-technology services as the main business activity. It was investigated 95.78% of the financial reports containing the notes. The analysis was performed using text mining method, utilizing every available notes to the financial statement of the sector. Findings of the study reveal that the amount of published information shows greater and lesser differences and in many cases, the quantity of published data does not fulfil even the minimal obligations stipulated legally.

Open access

Wojciech Misiński

Abstract

This article is a continuation and extension of the lecture ‘Causes and effects of incompleteness and non-inclusion of ownership structures of contemporary capital companies’ delivered at the conference in Wrocław in 2017 and published in the Scientific Notebooks of the University of Economics (No. 493). The aim of the article is to answer the question: why the Neoclassical Theory of Markets (Main Current Economics) does not explain the causes of a number of contemporary socio-economic phenomena, in particular, huge price fluctuations, breakdowns of individual markets and as a consequence of economic crises on a global scale? This required a new, different from the neoclassical view of the series of processes and market phenomena occurring in contemporary economies as well as the verification of the Neoclassical Market Theory paradigm constituting the main core of the Mainstream Economics. These include, in particular: 1) theoretical (classical) and real ‘object (s)’ analysis of market transactions; 2) rejection of one-dimensional, neoclassical analysis of exchange processes (transactions), accepting two or even three-dimensional analysis of the exchange process (transaction); 3) analysis of exchange processes (transactions), the ‘subject’ of which are complete, incomplete or partial (and their bundles) property rights; 4) analysis of exchange processes (transactions) by complete and exclusive and incomplete and non-exclusive decision-makers; 5) analysis of exchange processes (transactions), whose ‘subject’ are partial (and their bundles) property rights in relation to virtual (non-material) ‘goods’. Taking into account that the above verification (acceptance of a different from the neoclassical paradigm of market theory) allows to break out of the circle of elegant and logical neoclassical analysis of theoretical, never and nowhere existing markets (exchange processes), and more importantly, the explanatory reasons for a series of negative, contemporary socio-economic phenomena.

Open access

Katarzyna Brzychcy

Abstract

Despite the fact that they are public institutions and that they seem to have the status quo of their functioning already established, schools are still exposed to various internal and external organisational changes. The article comes as a broad reflection on schools viewed as organisations and their environment, including activities that are undertaken in favour of development of such organisations. First, the article presents an explanation of the essence of an organisation. On the basis of some definitions provided by expert literature, schools are presented as organisations. Some particular attention is focused on the problem related to school environment in its micro- and macro-dimensions; it specifically refers to the establishment and maintenance of organisation–school relations. Theoretic considerations underlie the discussion of the essence of the presented survey and its results. The aim of the survey has been to identify entities that cooperate with contemporary schools and the environment in which such cooperation takes place and also to indicate the consequences that result from the interpretation of schools as organisations and their relations with the environment, viewed from the perspective of resources. The material for the research survey has been collected with the methods involving questionnaire forms and interviews. The results of the research come as a part of a more extensive research process.

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Michał Masior and Zbigniew Staniek

Abstract

The article presents a reform that provides a regulatory framework for the legal services market, implemented as the Legal Services Act of 2007 in England and Wales. The reform was intended to systematise the institutional system of that market, to increase its transparency, to increase the role of competition and to enhance the position taken by customers at the expense of the current legal self-regulatory bodies. The reform involved development of a multi-level management structure for institutions–organisations that supervise or represent lawyers handling various market segments. A new form of functioning was provided to lawyers in order to facilitate acquisition of capital and know-how. A new package of supervisory measures was initiated and applied to operations undertaken by lawyers and their companies. The aim of this case study is an attempt at evaluating the above-mentioned reform and drawing conclusions for model operation of the legal services market. In order to achieve such an aim, the institutional change is described based on the current data about the functioning of regulators, taken from their websites. The article also refers to literature related to regulation of legal professions and the English-Welsh context. The conclusions that have been drawn prove the advisability of its implementation. For the sake of economic and social evaluation of the outcomes of the applied solutions, the dynamics of the rates describing market operation (supply, prices, demand, consumer choice) has been analysed. It has been stated that since the implementation of the reform in 2008, the accessibility of legal assistance has been increased along with the quality of legal services and market competitiveness. However, the authors of the reform have been disappointed with the scarce interest in new forms of development provided to legal companies, innovation for licensed lawyers and further increase in prices of legal services. A demand barrier has been also encountered. Despite all those facts, the value of the legal services market in England and Wales has been increased and export of legal services and the number of licensed lawyers have also grown. Furthermore, the reform has already found its followers in other countries.

Open access

Abdullah Saeed S Alqahtani, Hongbing Ouyang and Adam Ali

Abstract

This study investigates if the changes in economic policy uncertainty in the U.S. can explain the returns on stock markets of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. The study also examines how the stock market returns of the six GCC countries respond to the changes in economic policy uncertainty in the U.S. The results demonstrate that changes in economic policy uncertainty in the U.S. are not significantly linked with the returns on all the stock markets except Oman stock market, which shows a statistical significant negative relationship with the changes in economic policy uncertainty in the U.S. Controlling for the effects of the U.S. stock market and oil price, returns on all the six GCC markets including Oman show insignificant coefficients. The returns on all the stock markets do not respond to the changes in economic policy uncertainty. The results of Granger causality tests show that the changes in economic policy uncertainty in the U.S. do not cause the returns of all the six GCC stock markets.

Open access

Adam Koronowski

Abstract

The paper analyzes possible policy and institutional responses to underconsumption, which is viewed as an effect of a specific market failure. Microeconomic rational decisions to keep labor costs low, resulting in suboptimal macroeconomic outcomes. Traditionally, constraints arising out of deficient demand have been corrected with expansionary fiscal and monetary policies. These methods have ceased to be effective and viable. Alternative measures should be targeted at changing income distribution; low labor income is the reason for underconsumption. Such measures (progressive income tax, stronger labor unions) would probably not gain any acceptance of entrepreneurs, even though, in principle, they should boost business activity. Non-confrontational solutions are beyond the reach of economic policy but an informed democratic debate might lead to a desirable compromise.