<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">This paper assesses the determinants of innovation activities in Croatian enterprises and their implications for innovation policy. A Type-2 Tobit model is used for modelling the innovation behaviour of Croatian companies, based on the results of a Community Innovation Survey conducted for the period 2001-2003. This model identified the positive effects of conditions for enterprise growth (enterprise size and demand pull variable) and the integration of enterprises into international flows of capital and goods (through foreign direct investments) as well as R&amp;D activities. These variables can be tackled through a more effective policy framework that should increase competitiveness within industries in order to stimulate the demand for innovation. The focus should be on fostering enterprise growth, attraction of FDI with strong spillover effects, and stimulating the export capability of enterprises. Only in such a context can the positive effects of engagement in R&amp;D be maximised.</abstract>

Institute of Economics, Zagreb Trg J. F. Kennedy 7, HR-10000 Zagreb, Croatia

Centre for Strategy and Development Kranjčevićeva, 27a, HR - 10000 Zagreb

University of Wuppertal Gaußstraße, 20, 42097 Wuppertal

Innovation Propensity in Croatian Enterprises: Results of a Community Innovation Survey

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">Attracting foreign direct investments (FDI) constitutes one of the primary aims of the regions and cities of Southeastern Europe after the fall of communist regimes in 1989. In order to satisfy this aim, cities are characterized by a plurality of efforts to create their images based on their distinctive characteristics and in this way attract investments and specialized human resources. Factors such as agglomeration economies, access to European markets, urban infrastructure, as well as qualitative ‘soft’ factors such as the quality of life and urban aesthetic, are considered as location criteria for business establishment in potential locations. The aim of the paper is to examine the attractiveness of the city of Varna as an investment destination by using primary data derived from empirical research on Varna's firms. The firms evaluate a variety of factors (urban characteristics), defining Varna's advantages as an investment destination. These advantages were then used to create the proposed ‘investment image’ of the city.</abstract>

Attractive Investment Images in Southeastern Europe: the Case of Varna, Bulgaria

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">The use of trans-national common resources like rivers often creates problems between countries, but can also, as some historical examples show, give possibilities for stronger, friendlier political relations. The core of the solution to common resources is precise regulation through trans-national agreements that can be changed only in a Paretian manner. After a short presentation of examples of such agreements, the process of decision-making implemented in the 2004 Sava Framework Agreement will be analysed using economic theory, especially the Coase theorem and simple bargaining theory. Property rights in this agreement seem to be weak, as well as some regulations of the decision process itself. This weakness can be cured by installing a supra-national authority to supervise the decision-making process. In this case, the authority would be the European Union, as all the countries involved are trying to harmonise with the EU.</abstract>

The Use of the Sava River as an International Allocation Problem

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">It is possible to achieve faster rates of social growth, greater developement, a better standard of living and narrow the gap between rich and poor countries by changing a government's economic policies so that they emphasize investments in the developement of human potential. An increase in motivation, knowledge, levels of education and team organization, as well as a strengthening of citizens' moral, intellectual and social potential will, as the results of investigations quoted in this article show, bring faster growth of the Gross National Product (GNP). There is still a paradigm prevailing in south-eastern European countries to invest more in physical capital than in human capital. This paradigm is the reason that these countries continue to fall behind the most developed countries in the world.</abstract>

Impact of Human Capital on GNP Level

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">The study dealt with the work motivation of highly-educated Croatian employees, specifically those at the fore of their companies in terms of expertise amid this "Age of Knowledge," in order to provide recommendations for management on how to improve their levels of motivation, and give direction to HR experts on which motivation policies and practices to implement.According to the findings, highly-educated Croatian employees perceive that many regular motivation strategies are insufficiently present in their companies, are generally not satisfied with the motivation strategies applied, and are significantly less satisfied with motivation strategies because they deem them unimportant. Furthermore, they perceive non-material motivation strategies as more effective, assign these strategies greater importance and find them generally more satisfying than material motivation strategies. Finally, the findings indicate that there are no differences in work motivation between highly-educated Croatian employees with different characteristics.</abstract>

Faculty of Economics and Business, University of Zagreb, Trg J. F. Kennedya 6, 10 000 Zagreb

RTL Television Krapinska, 45, 10 000 Zagreb

Work Motivation of Highly-Educated Croatian Employees - What Should Managers and HR Experts Know?

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">Before conducting the research, two main hypotheses were proposed:H1: The majority of Croatian production companies use traditional accounting methods for cost allocation.H2: Direct production costs make up the largest portion within the production cost structure for the majority of Croatian production companies. Because of this production cost structure, modern cost allocation accounting methods would not contribute to more reliable company profitability evaluation and business decision-making.The research is based on a specific sample including every important Croatian public production company. The process of cost allocation process is not easy. It is a difficult and complicated procedure that requires the application of appropriate accounting methods. The process of allocating costs to cost objects is realized through the application of certain accounting methods. These accounting methods often cannot provide fair and objective cost allocation because they have arbitrary bases that are not always appropriate.</abstract>

Cost Allocation Accounting Methods Used in the Croatian Production Sector

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">This paper examines whether VaR models that are created and suited for developed and liquid markets apply to the volatile and shallow financial markets of EU candidate states. To this end, several VaR models are tested on five official stock indexes from EU candidate states over a period of 500 trading days. The tested VaR models are: a historical simulation with rolling windows of 50, 100, 250 and 500 days, a parametric variance-covariance approach, a BRW historical simulation, a RiskMetrics system and a variance-covariance approach using GARCH forecasts. Based on the backtesting results it can be concluded that VaR models that are commonly used in developed financial market are not well-suited to measuring market risk in EU candidate states. Using some of the most widespread VaR models in these circumstances may result in serious problems for both banks and regulators.</abstract>

Calculating VaR in EU Candidate States

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">This paper investigates whether gold is an internal hedge and/or an external hedge against Turkish lira (TL) by using monthly data from January 1995 to November 2006. Cointegration test results confirm the long-term relationships between the gold price and consumer price index and between the gold price and TL/US dollar exchange rate. The Granger Tests, based on vector error correction model (VECM), indicate that gold price Granger causes the consumer price index and TL/US dollar exchange rate in a unidirectional way. It is concluded that gold acts as an effective hedge against potential future TL depreciation and rising domestic inflation. Furthermore, gold price may be considered as a good indicator of inflation and hence it can be used as a guide to monetary policy.</abstract>

Department of Economics, Dunlupinar University, Tavsanli Yolu 10.Km, Kutahya, Turkey

Is Gold a Hedge Against Turkish Lira?

<abstract xml:lang="en" xmlns="http://www.w3.org/1999/xhtml">In this paper, the global simulation model (GSIM) for the analysis of global, regional, and unilateral trade policy changes by Francois and Hall (2003) was applied to the agricultural trade between the EU, the Balkans and Turkey. This was done in order to measure the effects of an EU accession of the Balkans and Turkey. Most of the changes in welfare after a full liberalisation of agricultural trade between the Balkans and Turkey on the one hand and the EU on the other hand can be expected in the accession countries themselves. It is estimated that incumbent EU members will be affected only to a minor extent. It was also estimated that the exchange rate risk is not very high.</abstract>

GSIM Measurement of the Effects of the EU accession of the Balkans and Turkey on Agricultural Trade

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Volume 18 (2023): Issue 2 (December 2023)

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South East European Journal of Economics and Business

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