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Abstract

The article is devoted towards the application of managerial accounting for deliverology development at the local government level in countries and comparing them to the stage of fiscal decentralisation implementation in Ukraine. The aim of the article is to show how the application of the managerial accounting approach in the public sector can contribute to the introduction of deliverology at the local level using Ukraine as an example. The methodology is based on the application of Difference in Difference method for the implementation of deliverology at the local government level. It has been proved that the use of multi-criteria decision-making methods in the analysis of the performance of budget programmes at the local level will contribute to the improvement of public services delivery. The main contribution of this study is to provide the basis for developing recommendations for the use of a single or uniform standard of electronic databases on regional development indicators and local budgets. This will help to ensure operational control over deviations of actual indicators from planned ones, as well as identify regions where local authorities are using resources inefficiently.

Abstract

Macroeconomic forecasters are often believed to idealistically work on improving the accuracy of their estimates based on for example the Root Mean Squared Error (RMSE). Unfortunately, reality is far more complex. Forecasters are not awarded equally for each of their estimates. They have their targets of acquiring publicity or to earn prestige. This article aims to study the results of Parkiet's competitions of macroeconomic forecasting during 2015–2019. Based on a logit model, we analyse whether more accurate forecasting of some selected macroeconomic variables (e.g. inflation) increases the chances of winning the competition by a greater degree comparing to the others. Our research shows that among macroeconomic variables three groups have a significant impact on the final score: inflation (CPI and core inflation), the labour market (employment in the enterprise sector and unemployment rate) and financial market indicators (EUR/PLN and 10-year government bond yields). Each group is characterised by a low disagreement between forecasters. In the case of inflation, we found evidence that some forecasters put a greater effort to score the top place. There is no evidence that forecasters are trying to somehow exploit the contest.

Abstract

In this paper, cryptocurrencies are analysed as investment instruments. The study aims to verify whether they can be classified as an asset class and what kind of benefits they may bring to the investor's portfolio. We used 6 indices as proxies for the major asset classes, including the cryptocurrency index CRIX, for all cryptographic assets.

Cryptocurrencies relatively fully satisfied 7 asset class requirements, namely stable aggregation, investability, internal homogeneity, external heterogeneity, expected utility, selection skill and cost-effective access. It was found that crypto assets have diversification properties. Portfolio optimisation with the Modern Portfolio Theory showed an increase in the Sharpe ratio of tangency portfolios with the inclusion of CRIX. However, the Post-Modern Portfolio Theory identified significant deterioration of the downside risk and the Sortino ratio.

Abstract

The article addresses the issue of stress testing based on the probability of bankruptcy and a rating migration matrix. The analysis is conducted on a sample of listed companies in Poland in the years 1998–2016, and the forecasts are made for the years 2016–2018. Particular attention is paid to how the variable on which rating migration matrices are developed is defined. Stress tests are carried out on variables derived from rating migration matrices and economic indicators. The study provides information on the methodology for stress testing.

Abstract

This paper examines the relationship between the voting behaviour of European Parliament members on the Common Consolidated Corporate Tax Base (CCCTB) proposal and economic characteristics of their respective countries. We are concerned about the political and economy factors behind policy and decision making of CCCTB in European Parliament. The analysis is conducted with Logit model identifying factors affecting the voting consultation decision of the Parliament of the European Union in 2018. Particularly, we investigate the impact of four components taken from tax benefit index proposed by W. Orłowski. We have found that economic factors alone are responsible the voting behaviour of the European Union deputies, not their personal characteristics.

Abstract

Unlike many studies concerning audit fees in Western Europe or the United States, literature concerning this kind of research is very limited in Central and Eastern Europe. This study aimed to show what factors shape audit fees in Poland. It was conducted based on data collected from the financial statements of 111 companies listed on the Warsaw Stock Exchange in 2018. The study used a linear regression model to verify the determinants of audit fees. The research results indicate a positive relationship between audit fees and company size, measures of complexity (in addition to the ratio of inventories and receivables to total assets) and the fact that a company is audited by the ‘Big Four’ accounting firms.

Abstract

This article primarily aims to estimate the impact of the Armenian revolution and test the hypothesis, that is, the benefits of revolution and establishment of democracy can be seen even in the first year after the political change. To calculate the short-term net surplus of the revolution, we estimated the difference between the projection of Armenian economic activity for the four quarters after the revolution, using only pre-revolutionary (assuming there was no revolution) and real data for the same period after the revolution. Using deep neural network models, such as recurrent neural networks and convolutional neural networks (CNN), we compared prediction accuracy with structural econometrics, such as autoregressive integrated moving average and error correction model, using pre-revolutionary data (2000Q1–2018Q1) for Armenia and combinations of models using an ensembling mechanism. As a result, CNN overperformed the rest of the models. The CNN simulation on post-revolutionary data indicates that during the period 2018-Q2–2019-Q1, Armenia gained approximately 850 million EUR in terms of GDP, thanks to the revolution and the new government. Moreover, out of seven models, the five best models in terms of accuracy indicated that the revolution had no negative impact on the Armenian economy, as the actual values were within or above the 95% confidence interval of the prediction.

Abstract

The paper aims to find what determines the choice of companies listed on the Warsaw Stock Exchange (WSE) between public debt (corporate bonds) and private debt (bank loans). For this purpose, we estimate logistic regression models and panel models of corporate borrowing determinants to compare the impact of enterprise characteristics on financing with the use of corporate bonds or bank loans. In this study, we are interested in explanatory variables that explain the role of transparency measured by the level of information disclosure; and a risk proxy of the variability of operational cash flows and investment risk (retrieved from generalised auto-regressive conditional heteroscedasticity [GARCH] models estimated on companies’ stocks [shares] trading on the WSE).

Abstract

This article presents the role of clusters in the Polish innovation system. This role has evolved in recent years due to maturing of cluster organisations and the expansion of their ability not just to provide services for cluster members but also to perform selected public tasks. This study aims to provide a better understanding of the nature and extent to which clusters can contribute to the objectives of development policies and thus to the economic development of the Polish economy and answer the question what role clusters can play in the innovation system. Based on a survey of 44 cluster organisations in Poland and interviews with cluster managers, the study explores the possibility of engaging Polish cluster organisations in the implementation of public policies. The results confirm that many of the Polish clusters achieved such a level of development that they themselves see the possibility of engaging in public tasks, for example education and specialised training, helping enterprises in digital transformation, monitoring technological trends, and so on. Therefore, it is justified pursuing a dual cluster policy. This duality means focus on two objectives: supporting cluster organisations on the one hand and implementing cluster-based development policies on the other hand.

Abstract

This article focuses on the determinants of inward foreign direct investment (FDI) in Russia. The article briefly describes the historical context of foreign investment policymaking in Russia since the beginning of the economic transition to an open market economy after the dissolution of the Soviet Union. When compared to other developing countries, Russia's FDI stocks continue to lag despite a set of proactive measures undertaken by the national government. Following the literature review, the most commonly cited determinants explaining inward FDI in Russia include market size, labour productivity, trade and investment barriers, domestic exchange rate, rule of law and institutional framework.

This article aims to contribute empirically to the study of determinants of inward FDI in Russia.

This article uses the Pseudo-Poisson Maximum Likelihood (PPML) estimation technique, the robustness of the PPML estimation is then verified using a standard autoregressive integrated moving average (ARIMA) model with the Durbin–Watson autocorrelation test.

Our benchmark results suggest the efficiency-seeking motive of FDI over a market seeking and horizontal motive as a main reason for inward FDI in Russia. The ARIMA regression indicates the absence of statistical significance of economic openness and variables of labour productivity. Overall, the market size and tax rate variables have the most positive effects on the inward FDI, while barriers to trade and sanctions have the most negative effects. The results confirm that for transitional economies, integration into the world economy, proactive local development and tax cuts for outside investors remain to be critical when it comes to attracting FDI.