Articles

This paper examines financial portfolio optimization by applying the Post-Modern Portfolio Theory (PMPT) to the Romanian capital market. The study is based on a sample of five representative companies included in the BET Index of the Bucharest Stock Exchange: Nuclearelectrica, Hidroelectrica, BRD – Groupe Société Générale, Digi Communications N.V., and Fondul Proprietatea. These companies were selected based on their high liquidity and representation of different economic sectors, both of which are essential for portfolio diversification and for ensuring continuous and comparable data series. The analysis employs a sample of 252 daily observations covering the period from 18 December 2024 to 30 December 2025. The research applies an extension of the Markowitz model based on the mean–semivariance behavioral hypothesis, focusing on downside risk rather than the traditional mean–variance framework. Accordingly, downside deviation, semivariance, and semicovariance were calculated for the selected financial assets in order to construct the semivariance-semicovariance matrix. The optimal asset weights were determined using the Lagrange multiplier method, resulting in the construction of two portfolio types: the minimum-risk portfolio and the efficient portfolio corresponding to a target expected return. Portfolio performance was also evaluated using the Sortino ratio. The results indicate that portfolio composition is directly influenced by the risk–return trade-off and confirm the applicability of Post-Modern Portfolio Theory to the Romanian capital market. Furthermore, the analysis highlights the importance of diversification and the role of defensive assets in reducing investment risk.

This study explores the intellectual evolution from traditional finance to sustainable and green finance through a bibliometric and comparative analysis. It is based on peer-reviewed articles indexed in Web of Science Core Collection published in English between 1990 and 2026. Through this approach, the paper maps the development of sustainable and green finance research, highlighting key thematic clusters and identifying areas where traditional and sustainable and green finance converge. The findings reveal a complex but fragmented scientific landscape. Traditional finance remains highly concentrated around a small set of core journals and authors, reflecting its maturity and theoretical consolidation. In contrast, sustainable finance shows moderate concentration, while green finance is more dispersed, highlighting its interdisciplinary and evolving nature. Keyword co-occurrence and temporal analyses indicate a significant rise in sustainability and green topics, especially after 2015, driven by increasing global attention to environmental and social challenges. Despite their shared relevance, the interaction between these three streams remains limited. Each based on its own theoretical fundaments, applies distinct methodological tools and responds to different policy and regulatory environments.

Africa possesses substantial natural wealth, yet persistent gaps between resource abundance and human development outcomes highlight structural constraints to inclusive growth. This article examines the developmental implications of China's expanding economic engagement in Africa, assessing whether it constitutes a catalyst for structural transformation or reinforces patterns of dependency. Over the past two decades, China has become one of Africa's principal economic partners through foreign direct investment, infrastructure financing, trade expansion, and institutional cooperation under the Belt and Road Initiative and the Forum on China–Africa Cooperation. Chinese investments in ports, railways, energy systems, and industrial zones have addressed critical infrastructure deficits, reduced trade costs, and supported regional integration. However, trade relations remain asymmetrical, with African exports concentrated in primary commodities and imports dominated by manufactured goods, contributing to persistent trade imbalances. Resource-backed lending and rising debt exposure further raise concerns regarding fiscal sustainability and long-term developmental impact. The findings suggest that infrastructure financing alone does not guarantee sustained economic growth; outcomes depend on governance quality, institutional capacity, export diversification, and industrial upgrading. Ultimately, the developmental trajectory of China–Africa relations is contingent upon African policy choices and the effective transformation of external capital into inclusive, resilient economic structures.

This article explores the macroeconomic impact of the sanctions regime imposed on the Russian Federation over the decade starting in 2014. Triggered by geopolitical conflicts, these sanctions targeted critical sectors such as finance, energy, defense, and technology, leading to significant structural adjustments within the Russian economy. Through an analysis of key indicators—including GDP growth, inflation, trade balances, and currency stability—this paper evaluates the short- and long-term economic consequences of sustained international pressure. The findings suggest that while sanctions contributed to initial economic contraction and financial instability, Russia gradually adapted through strategic fiscal policies, import substitution, and realignment of trade partnerships, particularly with non-Western economies. Despite these adjustments, the sanctions have led to slower economic growth, reduced foreign investment, and technological stagnation. This retrospective analysis offers insight into the effectiveness of sanctions as a policy tool and the resilience mechanisms of a major global economy under sustained economic isolation.

Over the past two decades, we have witnessed a profound shift from a unipolar world order to a multipolar one. Following the dissolution of the Soviet Union, the United States emerged as the singular superpower, exerting unparalleled influence over the international stage. In the current landscape, power has undergone diffusion, with numerous major players wielding significant sway in shaping global affairs. Amidst this dynamic backdrop, the spotlight shines brightly on BRICS, a coalition comprised of five emerging and developing nations: Brazil, Russia, India and South Africa. After 14 years of global turmoil, interest in this organization has surged. Its membership has grown, with the addition of four more nations in 2024, while many other countries have expressed keen interest in joining. The article examines the opportunities and challenges confronting BRICS, analyzing whether this coalition of emerging economies can truly rival the dominance of the established G7 bloc.

The rapid growth of public debt in the 1980s gave rise to a new expression. The snowball effect in question, refers to the automatic swelling of the debt by its interest charges, or the self-sustaining process of public debt by the interest owed on it. The primary surplus is the alternative that will reduce the debt and, by the same token, the snowball effect. In response to the ever-increasing debt levels and budget deficits of European countries, the Maastricht criteria were proposed in 1992. In order for European states to converge, a debt threshold of 60% of GDP and a maximum budget deficit of 3% of GDP were set. We are entitled to analyse the relevance of these criteria to determine whether they will prevent a snowball effect. (Bohn's 1998) model serves as a guide in this context. Analyzing panel data on 33 OECD countries using the OLS method, it shows that the primary surplus/deficit is improved when the debt ratio is below 60% of GDP, which makes it possible to reduce interest charges and, ipso facto, public debt. The budget deficit follows the same logic.

This article examines the paradigm shift within the banking sector's approach to cryptocurrency and blockchain technology. Initially, major financial institutions like Citigroup, JPMorgan, HSBC, and Goldman Sachs viewed these innovations with scepticism, primarily due to concerns about regulatory compliance, security, and market volatility. However, as the potential of blockchain for revolutionizing aspects such as cross-border payments, trade finance, and overall transaction efficiency became evident, these banks began to adapt and integrate these technologies into their operations. Through a series of case studies, this paper explores the journey of these banks from their initial resistance to a more embracing stance, highlighting key developments such as Citigroup's Citicoin, JPMorgan's JPM Coin and Onyx division, HSBC's application of blockchain in trade finance, and Goldman Sachs' establishment of a cryptocurrency trading desk. This analysis not only sheds light on the evolving dynamics between traditional banking and digital financial technologies but also discusses the broader implications for the future of banking, regulatory landscapes, and the continuous innovation in digital finance. The article aims to provide a comprehensive understanding of how traditional financial institutions are navigating the challenges and opportunities presented by cryptocurrencies and blockchain technology, marking a significant transition in the financial industry.

The determination of prices for goods and services in a specific economy is significantly influenced by commodity prices and the distribution of energy. Hence, this study aims to examine the impact of fuel prices and electricity supply on the inflation rate in South Africa. The empirical analysis focuses on a time series data covering the period from January 2009 to December 2021. The study utilizes the Johansen test for cointegration, Vector Error Correction Model (VECM), and Granger approaches to establish the relationship between the variables. The empirical findings indicate the existence of a long-term relationship among the variables, indicating that long-term changes in electricity supply and fuel prices have an influence on South Africa's inflation levels. Similarly, the short-term results suggest an inverse relationship between fuel prices, electricity supply, and the inflation rate. In order to reduce the inflation rate, it is recommended to decrease spending on imported fuel and enhance electricity supply through increased investment in renewable energy and research and development (R and D).

The common desire of civilizations to reach out and interact with each other naturally gave rise to the process of globalization. Globalization has proven to be a dynamic process, triggered by technological changes and the decline in barriers to the free flow of goods, services, capital, and people. However, after decades of increasing economic integration, globalization shows signs of slowing down. The recent years have seen rapid changes in the global economy, in the context of events that drew attention to the vulnerabilities of globalization. In the present paper, I want to emphasize the impact the most significant events of the last 15 years have had on globalization and answer a very controversial question: ‘Is globalization coming to an end?'

The issue of whether military expenditure interacts with economics forces to facilitate economic growth remains a reoccurrence debate since the Benoit Hypothesis (1978). This paper aims to show how Nigeria's economic growth, military spending and external debt interact under a unified framework. Because the considered variables are non-stationary and the modelled relationship cointegrated, the interconnectedness is reported based on the VECM. The findings show economic growth leads to a significant increase (decrease) in the current value of defense spending (debt). More so, increased debt creates pressure that may ignite the next period growth. The findings identify new challenges for policymakers to put growth pursuit and debts profile into consideration when developing the defense budget.

This study explores the relationship between trade balance, exchange rate performance, foreign direct investment and economic growth in the Southern African Development Community (SADC) using quarterly data from 1970 to 2022. The results demonstrate that trade balance and exchange rate performance have a positive and significant impact on economic growth. The findings from the Dumitrescu-Hurlin (DH) panel causality tests suggest a bidirectional causal relationship between trade balance and economic growth, as well as between exchange rate performance and economic growth. The study concludes that promoting sound policies to enhance exports, reduce import dependency, and create favorable macroeconomic conditions is essential for achieving sustainable economic growth. Moreover, the study recommends the implementation of policies that optimize the benefits and retention of foreign direct investment (FDI) gains.

India is currently the fifth country in the world in terms of GDP, after the USA, China, Japan and Germany, and on track to become the world's third-largest economy by 2030, according to S&P Global. The key investments that the country has made in technology and energy together with the global offshoring after the COVID-19 pandemic, made the country one of the fastest-growing economies in the world. In this article, I want to present the stages that India went through to develop and become the world's 5th largest economy, and answer the question: Is India ‘the next China'? Can India, in the near future, reach and even surpass the economic performance recorded by China and become a more attractive country for foreign investors?

The purpose of this study is firstly to assess the impact of the Covid-19 pandemic on the South African economy and secondly, to explore the recovery prospects in the aftermath of the pandemic. The key macroeconomic variables include GDP, debt-to-GDP ratio and budget deficit/surplus. Publicly available secondary data with a time span from 2000 to 2022 are utilised. The study adopted a descriptive research design and conducted quantitative analyses. The results show that the biggest gap between government revenue and expenditure was recorded in 2020, as evidenced by the 10% of the budget deficit. The results also indicate that the debt-to-GDP ratio is way above the 60% threshold with a steeper positive slope, coupled with less encouraging economic growth, as evidenced by low GDP projections. Fiscal sustainability requires keeping the debt-to-GDP ratio in check over the medium term by limiting government expenditures and stimulating investment.

The paper addresses, from a logical and epistemological perspective, the concept of order, in general, and the concept of economic order, in particular. For this purpose, the phenomenological "window" is used by which the subject (both cognitive and praxiological) knows or ”creates” economic objects. From the methodological point of view, the study proceeds, first, to identify the predicates of sufficiency that the concept of order implies. Next, an epistemological mechanism for the detection, putting into evidence, and qualification of an empirically given economic order is introduced and qualitatively examined. The paper is maintained within an abstract approach, following which subsequent research directions establish relevant classes of economic orders, both from an intellectual perspective (that is, who uses the subject's intellect) and from a praxiological one (that is, who uses the sensitive ”endowments” of the subject).

Compare prices of hotels and flights, analyze the score of the most famous restaurants in the area, find information about the customs of the inhabitants of the place we are going to visit or locate the location of the hotel on a map. These are just some of the actions that any traveler performs today before leaving for their destination. Social networks, geolocation applications, information search engines, price comparison websites or online travel agencies have given way to a new tourism scenario, one of the sectors that has best known how to take advantage of the possibilities offered by the digital universe.

This paper discusses the changes of Taiwan stock index futures'(TF) return rate before and during COVID-19, using the nonlinear regression model to compare the differences as the explanatory variables including the time variable, MSCI Morgan Taiwan index, and Taiwan stock price index (TAIEX). We find that the three kinds of return rates do not satisfy the Normal distribution assumption of regression analysis. Then we follow Wang and Lee (2019) to run nonlinear regression to find the optimal nonlinear estimators. There are three results. One is that the time variable can grab the oscillations of TF's return rates before COVID-19 and the whole observation period. During COVID-19, the time variable did not display the oscillation effect of TF's return rates. In contrast, MSCI Morgan Taiwan index's return rates appeared the oscillation effect. Second, the return rates of TAIEX have invariable function form and coefficient sign. This implies that COVID-19 did not affect the positive association between the return rates of TF and TAIEX.

Switzerland is a federal state made up of twenty-six Cantons. This article studies the funding mechanisms of the Cantons and the solidarity they induce. The article is based on the rules and formula provided by the Swiss law and on calculations for the year 2020. This article highlights the redistributive character of the Swiss system of funding and even shows in some cases a paradox of revenues, some Cantons becoming wealthier than others which were initially wealthier.

Small, Medium and Micro-sized Enterprises (SMMEs) in South Africa continue to endure economic challenges in spite of their entrepreneurial activities and potential for growth. The study's purpose was to investigate the impact of business empowerment workshops on the growth of SMMEs towards radical economic transformation in a South African municipality. Small businesses continue to struggle in spite of being recognised as important contributors to growth in the country and have been on the national agenda since 1994. This study analysed the current state of small business in a particular municipality and examined initiatives to assist small businesses and their current obstacles, and what could be done to encourage small business growth. The study proposed to introduce ways on how growth could translate into improvements in the lives of workers and the community thereby reducing the unemployment rate in the province. There was a general agreement about funding opportunities becoming available after attending the workshops. A quantitative approach was utilised with the use of a survey questionnaire. One recommendation was the establishment of a special purpose fund invested through an insurance institution towards resuscitating SMMEs that face growth-related challenges.

Early school leaving (ESL) is a topic of utmost importance at both European and national level, with significant social and economic implications. Young people who leave school can face a lack of jobs, social exclusion, poverty and health problems. The reasons for such a decision are complex, being a twinning of personal, social, economic, educational and family factors. In the context of the effects of the 2007-2008 economic and financial crisis, coupled with a number of long-term challenges such as globalization, demographic decline and pressure on resource use, the European Council adopted on 17 June 2010, a 10-year program entitled the Europe 2020 strategy. This program aims to create the optimal conditions for each Member State of the European Union to develop and achieve a high level of employment, productivity and social cohesion. One of the objectives set in the Europe 2020 strategy in the field of education is to reduce the early school leaving rate below 10% in the EU and 11.3% in Romania. In this article I want to answer the following questions: How is ESL defined in Romania? What are the factors that impact it? What are the main groups at risk of early school leaving in Romania? How has the ESL rate evolved in Romania in the last 10 years and what should the government do to prevent and reduce this phenomenon?

The term social entrepreneurship has a certain antiquity, dating back for almost three decades in literature, but it has gained its own place, becoming an economic, social and even global phenomenon due to top social entrepreneurs and to the existence of a coherent knowledge system. Entrepreneurship oscillates between traditional forms called commercial entrepreneurship and forms that target the social aspect, conventionally called social entrepreneurship. Reporting the social impact by companies to obtain organizational legitimacy and reflecting the ethical business model require the identification of reporting practices that lead to creative and adaptive reflection of companies' actions. Starting from these considerations, combining methods of scientometric analysis with those of systematic review of the literature, we aimed to identify and map the structural, temporal and geographical evolution of the concept of social entrepreneurship and its interconditioning with the non-financial reporting.

The main purpose of the article is to study revenue and expense management system on the government budget in Azerbaijan, the activities of Oil Fund (SOFAZ) and its place in budget transfers. In fact, some sectors have managed to maintain an acceptable level of efficiency, according to the circumstances, however, most showed some inefficient levels in the management of resources and at the same time, it was discovered that most of the state budget revenues (approx. 50%) are formed in the oil and gas sector which this does not allow for sustainable economic development. Research work has been carried out on the basis of systematic analysis and methods. The practical significance of the study is in the implementation of the set of measures proposed in the article. It is based on the evidence that the mechanism for the use of oil revenues in Azerbaijan will be improved and the effectiveness of long-term management for government expenditures is ensured.

Countries pass through different stages of structural transformation. In the early stage of development, economic activity is dominated by agriculture and mining. As a country develops, firms adopt new technology and move toward industrialization and faster economic growth. Eventually, the society matures when political and economic institutions are well established, and the society moves towards mass consumption. In a matured economy, generally government interventions are replaced by privatizations in production and trade. Accordingly, international trade barriers are reduced as a country moves towards later stages of development. Recently the US government has moved against the trend by imposing tariffs on China's imports. There is a literature on positive effects of trade liberalization and economic growth. Not unsurprisingly, the Chinese government retaliated by introducing tariffs on US produced goods. For the time being, the result of this trade war on US and China's trade balance is unclear. However, this development has introduced excessive volatility and uncertainty in global financial markets.

The need for non-financial reporting was strengthened by the challenges of a globalized environment based on the knowledge of business activities and on the promotion of the use of information. Accounting professionals have come to challenge the traditional business financial reporting model, arguing that when evaluating a company's past and future performance, the need to inform all stakeholders is not adequately met. Several articles do not clearly define non-financial reporting, the authors referring only to basic concepts used in research, such as environmental reporting, sustainability/durability reporting, social reporting, ethics and durability reporting, corporate reporting, corporate governance reporting, social responsibility reporting, integrated financial and non-financial information reporting, risk and capital management report. Analysing the publications that research the non-financial reporting, we identify in the decreasing order of frequency, the following terms: non-financial information, non-financial reporting, non-financial disclosure and extra-financial information / disclosure / reporting. Based on these considerations, in the incipient phase of our research, we carry out a systematic literature review (SLR) in order to identify and analyse the research trends, methods and research frameworks used in identifying non-financial reporting types, the way in which performance is reflected in these reports and how stakeholders influence the economic entity in designing the reporting method. One challenge in achieving this SLR was the fact that there is no guide for carrying out this type of literary review in the field of accounting, and that there is sufficient fragmentation in the research literature in terms of defining non-financial information and non-financial reporting.

A burning topic today is the freedom of international trade, namely the degree of intervention of the state in the economy. Like most of the developed countries, the U.S. got rich and promoted its young industries by applying tariffs and quotas. Protectionist measures proved to be beneficial in the short term, but if prolonged, they are likely to discourage trade and confer too much power to the state. The U.S. President Donald Trump has decided to turn from free and open trade toward so-called fair trade based on "America first" policy. Thus, the U.S. free trade began to lose the fight with economic protectionism, and national interest gained ground at the expense of economic cooperation. The desire to make America great again will benefit some national companies, but others will suffer major losses.

From 2014-2018 Romania recorded the fastest growth rate among the CESE-6 countries (Bulgaria, Croatia, Czech Republic, Poland, Romania and Hungary). To achieve this performance, it embraced an economic growth model based on consumption rather than investment. The government's strategy was to cut indirect taxes, increase public wages and old-age pensions but this generated higher inflation rates and larger budget and current account deficits. Thereby, according to the most recent Convergence Report issued in 2018 by the European Commission, Romania turned out to be the least prepared among the CESE-6 countries to adopt the euro. Reality has shown that an economy that relies too heavily on consumption and neglects investments is more vulnerable and has difficulties in supporting long-term economic growth. In order to improve the performance of its macroeconomic indicators and increase the living standard of the population, Romania must shift the growth model to investment.

Although it is not still clear if the time passing is a result of world changing, or reversely, the world changing is a result of the time passing, I think it is very clear the changing in the external and internal world of the subject is real. The paper examines, from a logical point of view, the abstract categories of changing, no matter the field involved. More precise, it provides the complete list (in the author's opinion) of distinctive types of changing, classified in two fundamental types: a) changing of first order, and b) changing of the second order. Based on this classification, certain analyses and assessments are delivered, regarding the logical features of them.

Globalization disrupted the seemingly solid construction emerged in the aftermath of WW II, called the international trade system. For over fifty years, the system grew constantly thanks to the increasing number of countries that joint it as well as to its ubiquitously-accepted rules. For better and for worse the system has worked according to traditional theory principles, whose core credo was that all participating countries would gain more if engaged in trade than if in autarchy. Globalization has muddied the waters. The contemporary order in which multinational companies make the rules has made these predictions look elusive. One serious implication is today's unorthodox approach of trade policy, free trade being sacrificed in favor of managed trade, with the whole string of good and bad consequences that derive from states' intervention.

The Costa de Hermosillo is an agricultural region of the state of Sonora, Mexico, with a semi-desert climate which has been closed for water extraction for more than fifty years. This region played an important role as a barn in Mexico during the import substitution industrialization model, through the cultivation of grains and cotton, at the same time important organizations were formed that integrated producers, which mostly disappeared in the change of export-oriented economic model. The goal of this work is to analyze the actions taken by farmers in order to migrate to agriculture by contract and the effects of this form of production, by examining the main crops that are produced in the Costa de Hermosillo, Sonora under this modality. To achieve this goal, a qualitative cross-sectional research was followed, using semi-structured interview, as well as a desk research with data from government institutions. As a conclusion the farmers of the Costa de Hermosillo, facing a change of economic model, turned towards agriculture by contract, in order to have certainty in their production and the price in dollars agreed in advance. The observed effects are mixed. On one hand, Sonora state is the leader in the national production of agriculture by contract, as farmers have invested in infrastructure to improve their water use efficiency and develop more technified crops, in order to ensure quality as established in production contracts. On the other hand, the agreed production is almost entirely destined for foreign markets and local consumers have to pay higher prices for those products.

This paper discusses how to obtain the Black-Scholes equation to evaluate options and how to obtain explicit solutions for Call and Put. The Black-Scholes equation, which is the basis for determining explicit solutions for Call and Put, is a rather sophisticated equation. It is a partial differential equation of the second order, parabolic, similar to the heat equation. The terms of the equation express diffusion in a homogeneous environment, convection and reaction. The main objective of the paper is to present the Black-Scholes methodology and apply this methodology on the underlying asset of the nature of the listed stock on the Bucharest Stock Exchange. Also, a secondary objective is to compare the results obtained in this paper with our results in an article where we determined the values for Call and Put by Monte Carlo simulation.

This research examines regional government performance in Indonesia's provinces after the implementation of fiscal decentralization in 2001 using a two-stage approach. First, extensive input and output data are utilized to measure government productivity and efficiency indices using a Malmquist productivity index (MPI) for four significant expenditures for the 2004-2015 period: infrastructure, education, health and social protection. Second, the relationship between the degree of fiscal decentralization and the first-stage productivity scores is analyzed using a Tobit model. This study provides extensive and internationally comparable data that distinguish it from existing studies in Indonesia because appropriate input and output data are the significant elements in measuring government expenditure efficiency. From the estimation results, the degree of fiscal decentralization is found to promote government expenditure efficiency. Tax revenue collected by regional governments will support government expenditure efficiency in the infrastructure, education and health sectors; however, the degree of fiscal decentralization seems to negatively affect the government expenditure efficiency in the social protection sector. Therefore, the methodology constructed in this research can be a prominent instrument for the government to upgrade regional government performance in Indonesia.

The study proposes and tests a risk-free rate model that simultaneously lets the risk-free rate migrate between rating categories as risk-free rate ranges, and follow a random walk within rating categories as risk-free rate ranges. Although the study arbitrarily assigned rating categories, and risk-free rate ranges to the rating categories, empirical research can clarify this, by examining the relationship between the risk-free rate and risk-free rate volatility, and by examining the relationship between sovereign credit ratings and risk-free rate ranges as well as risk-free rate volatility. Firstly, comparable risk-free rates should illustrate comparable risk-free rate volatility, and risk-free rates should cluster in terms of their risk-free rate volatility characteristics. Secondly, sovereign credit ratings should demonstrate risk-free rate ranges and risk-free rate volatility characteristics. To test the model, a risk-free bond portfolio, together with a risk-free rate rating migration matrix were simulated. The rating migration matrix governs the migration between risk-free rate rating categories. It is shown that the original migration matrix can again be decomposed with adequate accuracy, given that the appropriate constraints are used. It indicates that the model can be applied to empirical markets. Possible refinements to the model are noted.

The study reviews equity valuation, and proposes an alternative equity valuation model based on a random process modelling of earnings and equity growth. A Markov process is used to model earnings, standardized as earnings to book value, and book value based on rating category. This assumes a distinct relationship between rating category, and standardized earnings as well as book value: that both standardized earnings as well as book value are comparable per rating category, but distinct across rating categories. It is also assumed that a company inherits the earnings and book value distribution of its current rating. To test the premises of the equity valuation model, the study examines the standardized earnings and book value distributions of rating categories. The research population comprised all publicly-traded, rated equity of the JSE and NYSE stock markets. Sample data was limited to all equity of the major rating categories (AAA, AA, A, BBB, BB, B) for the 8 year window period 2009 to 2017. It is shown that earnings to book value are comparable per rating category, and distinct across rating categories. Analysis of book value growth revealed unexpected and surprising results, with no truly consistent pattern across rating categories, but rather individual relationships per rating category. The results raise questions regarding rating accuracy and rating theory. The implications of the results for equity valuation are discussed.

In this paper, we explore an econometric model of the dependence of the number of employees working in the tourism sector in Azerbaijan, on the investments in the tourism sector. Based on the results, it has been established that investment in the tourism sector has a significant impact on the increase in the number of workers in the tourism sector for the following year. Also, if annually the tourism sector attracts investments in the amount of one billion manat, this will lead to an increase in the number of employees in this sector by 7.471 people, for the following year.

Mobile devices proved to be disruptive for businesses. Installing, accessing and buying a new application become easy. Application marketplaces called Application Stores provides security (due to certification process imposed to developers), accessibility, application lifecycle serving as a central point for distribution, retirement, versioning, payment and consent for terms and conditions. Also, it allows capturing users feedback and application ratings. In general, we identify two categories of mobile applications available for installation: zero cost and paid. The way the developers monetize the apps usage can differ significantly, but installations/ downloads are part of an ecommerce transaction intermediated by the platform providers (Application Stores). Some applications offer a substitute to existing services (or extending distribution channels of a business) while others offers unique products or services available only through the platform/ mobile application. So, why some users prefers to buy mobile applications, while others not? This paper explores the potential value of survey captured open-ended answers by using natural language processing techniques with topic modeling, aiming to identify potential motivational categories. Data was collected as part of a larger study from 361 respondents and 231 responses in free text format that were used a corpus. The research (as part of motivational research in mobile applications buying behavior) was not referring to a specific application. Corpus was explored from the lens of motivational research using Latent Dirichlet Allocation (LDA) in the context of Technology Acceptance Model evaluating practical implications of the results.

In the present paper, there are presented, theoretical and applicative, two issues: the evaluation of the European options using the Monte Carlo method and the measurement of the entropy of information for the price of the underlying asset of the option. The underlying asset used in our analyses is the share of Compa SA. Through Monte Carlo simulations, scenarios are created on the random evolution of the underlying asset, and the valuation of the option on the underlying asset is made using the Feynman-Kač theorem. The distribution we use is lognormal. Also, in the paper is measured the entropy of information of Shannon type. The measurement of the entropy of information of the stock market price of the underlying asset is calculated annually, considering the stock market price in this case as a discreet random variable.

This paper presents the theoretical and applicative model elaborated by Harry Markowitz on the determination of the structure of the efficient securities portfolio. In this sense, in order to determine the structure of the efficient Markowitz portfolio (PE), a Lagrange function is built and minimized. Also, on the basis of the results obtained from the analysis, the profitability of the portfolio is modeled continuous time and determines the range of values in which it can be found over one year after the analysis period. The data used in our analysis are shares of financial investment companies (SIF), traded on the Bucharest Stock Exchange, and the distribution used in the analysis is lognormal. The structure of the portfolio obtained through the Markowitz model can be compared to the structure of the portfolio obtained through the Sharpe model from a previous article titled ”Portfolio optimization - application of Sharpe model using Lagrange” (Brătian, 2017).

The analysis of the propensity to search under price dispersion discovers the identity of the optimal consumption-leisure choices in the model of optimal search and in the classical model of individual labor supply when the propensity to search is unimportant. However, the vigorous propensity to search, which occurs when consumers visit high-price stores, challenges the classical view on the optimal labor-leisure trade-off. The vigorous propensity to search creates the positive consumption-leisure relationship. The willingness to substitute labor by search under price dispersion also changes the understanding of the income elasticity of demand. The modest propensity to search creates normal but income inelastic demand. The income elastic demand becomes the result of the vigorous propensity to search where consumption-leisure trade-off is positive and either consumption or leisure becomes “bad”. This theoretical assumption proves the occurrence of Veblen effect as well as money illusion and creates doubts in the existence of the general equilibrium.

The research project aims to present a comparative analysis of countries related to the value of their MNCs in the global arena. The study works in secondary data analysis using as a platform the Forbes Global 2000 list, which is maybe the best source explaining the presence of MNCs by country. This research goes beyond the information provided by the original list, offering an index and information about the number of corporations per country as well as their value (number of corpora-tions per country, their position in the ranking and the weight obtained by each company expressed in numerical value). Also the index obtained has been adjusted to the population of each country to determine which one should be the expected value per country from a more realistic perspective. An analysis of cultural clus-ters and trading zones has been applied as well. Finally, a calculation of the dif-ferent sectors where MNCs operate give the index the possibility to estimate the % of penetration or importance of the services and financial sector in each country and in the world.

In this paper, I discuss the effects of certain trade policy measures, mostly import tariffs, presently contemplated by the US government, aimed at enhancing domestic employment in a number of targeted industries. I intend to show that insofar as such measures restrain free trade among NAFTA member-countries, they run counter to a basic rule suggested by conventional theory, stating that, following changes in the tariff structure, resources will shift toward activities that enjoy the highest rate of effective protection. I try to demonstrate that erecting barriers against inside-NAFTA trade, aside from hurting industries that use outsourcing extensively, has little chances to create incentives for labor shifts in the desired direction.

Entrepreneurship has attracted the attention of many scholars in the last years due to its importance in the economy. Entrepreneurship is considered by many an important factor that could have a positive influence over the economic growth. Despite the recognition of the role of the entrepreneurship there is no general agreement of how entrepreneurship impacts the economy or a specific industry. The aim of this article is to provide some information about entrepreneurship, ways of measuring entrepreneurship, most common metrics used and the impact over the Romanian economy. To underline the relationship between these concepts some analysis were conducted in order to determine if they are correlated.

The theory of the optimal-consumption leisure choice under price dispersion describes the phenomenon of moral hazard as the customer's reaction on unfair insurance policy. The unfair insurance offer does not equalize marginal costs of propensity to seek healthcare with marginal benefits on purchase. Under unfair insurance policy consumers increase ex post healthcare seeking activities and they optimize their consumption of medical services. The analysis of moral hazard results in the assumption that the increase in the time horizon of the unfair insurance offer makes it fair and moral hazard becomes inefficient. The time horizon competition between insurance companies can eliminate moral hazard effect that clears the way to the competitive equilibrium.

The purpose of this paper is to estimate demand elasticities of cigarette, alcohol, and cocaine for a sample of young American population. To deal with the inherent censoring issue in cigarette, alcohol, and drug consumption data, the paper applies ZINB, Tobit, and a two-step AIDS model. Findings indicate habit formation in young American consumption. Also, the results show that alcohol has an inelastic income elasticity. The ZINB model price elasticity, Marshallian own price elasticity, and Hicksian own price elasticity all agree that drug has a negative inelastic own price elasticity. This implies that price increased by drug traders increases their total revenue and slightly affects the quantity demanded of drug.

This paper focuses on and compares two specific definitions of performance: economic and financial, with the aim to provide evidence that supports the distinctions between both definitions. Relying on a Belgian sample consisting of 14,135 firms, our results show that one specific variable deserves to be questioned: the worker's level of education. On one hand, it seems that the workers' level of education has a positive impact on economic performance; namely, the more the firms hire highly educated workers, the more productive it is. On the other hand, it seems that the effect is entirely the opposite when the financial performance is taken into account. In this case, the more the firms rely on highly educated workers, the less it is performing in a competitive manner.

The Australian dollar is known as a commodity currency because it is sensitive to fluctuations of commodity prices. Although the structure of Australian production has historically moved from the primary commodities to manufacturing and services, market expectations of the currency are still strongly influenced by the variation of the commodities' prices. Recent evidence show that the Australian dollar has fluctuated in response to the growth of the Chinese economy. The empirical results from this study show that commodity prices as represented by oil price changes and the growth of China's economy are the most important variable influencing the Australian currency.

This paper presents a study on the importance of copper production in the State of Sonora, Mexico. Important data will be presented with total relevance to the current economic framework in which it will be possible to determine through a thorough investigation the reason why Sonora as a state is a great potential producer, as copper exporter in comparison to the other producing states of Mexico. The main producing states of the country will be presented using statistics that show the production of each of them in the time-frame of 2011-2016.

In this study the results obtained from the previous theoretical and practical studies were examined and the factors that determine foreign trade were analyzed. For this purpose, considering the annual data belongs to 1994-2016 period unit root test, Co-integration test, short-term VAR analysis and Granger Causality analysis were performed in order to determine the relationship and the direction of impact between foreign trade balance and determinants of foreign trade. As a result of the econometric analysis we obtained parallel results with the previous literature. While positive relationship has been found between foreign trade balance and foreign direct investments, foreign income and reel exchange rate, negative relationship has been found between domestic consumption and reel interest rate.

This research was conducted to identify the condition of village institutions, to design the reinforcement model of village institutions in Lhokseumawe city and to obtain a synergy role model of stakeholders in developing a creative economy in the rural area of Lhokseumawe city. The data used in this research was primary data and secondary data. The research methods were qualitative and quantitative. The results indicated that the conditions of village institutions in Lhokseumawe city were generally still weak, namely that village officials were still less educated and lack understanding of the new rules issued by the central government. The reinforcement model of village institutions in Lhokseumawe should be based on the reinforcement of village officials through training and empowering, programs which should be conducted by the government for society's welfare through empowering the creative economy. The successful implementation of the creative economy should be supported by the synergy role of the Stakeholders. Lhokseumawe city is has a lot of potential for developing a creative economy because there are many resources with potential, such as natural and human resources that can be developed.

The financial crises of 2007-2008, caused wide-spread falling output and unemployment, in the affected countries and also globally. The severity of the recession was such that it was called the “Great Recession”. As a result of an increase in demand from China and India, at the same time, oil prices rose significantly. The empirical results from this study show that oil price changes negatively affected global growth rate in the 1970s but not in the 1990s and 2000s. These results suggest that the Great Recession in 2008 that initiated by the financial crises, was independent of a significant rise in oil prices.

This paper explores longitudinally and globally the relationships between cultural clusters and the determinants that drive market potentiality. The research shows differences in variances in all 7 determinants using a longitudinal one way Anova method and an Estimated Size Effect. Conclusions show three revealing issues: 1.There is significance in all Market Potentiality Index determinants with the exception of “Market Intensity and Market Receptivity”. 2. The clusters do not show significant differences according to the MPI determinants with the regular exception of Latin American cluster. 3. The results obtained after the estimated effect size analysis show that Commercial Infrastructure and Country Risk are the most important factors which influence on the variability of the clusters.

This article aims to approach highly important and current aspects regarding the public debt crisis in the European Union's economies. The current economic situation determined by the effects of the crisis is causing the governments of the countries worldwide to streamline their processes in terms of collecting revenue from the state budget and then redistributing them on the principle of performance and economic efficiency. Under these conditions, this article is based on a set of previous research and studies conducted at the EU level. In these analyses and studies, the following aspects were examined: (1) European Union's competitiveness in terms of country risk and fiscal discipline, and (2) Fiscal policy under current challenges and constrains at EU level. Based on these empirical analyses, a series of complex relationships are highlighted within the European community, more precisely in the context of markets with turbulences and search frictions that currently exist in the European Union.

After focusing on the Euro crisis, European leaders are now struggling with the biggest migrant crisis since Second World War. Up to now, over 1.1 million migrants have requested protection in Europe, and their number is growing every day. The functioning of the Schengen area is in danger due to control deficiencies at external borders. As it's facing this challenge, the EU is constantly seeking solutions designed to restore the proper functioning of the system and prevent its collapse.

Building a sustainable performance system at the level of the local public administrations must have as starting point the local public administration's (LPA) mission and must go down to the level of the individual. This system must follow the external performance that it delivers to the citizens, the outcomes generated, but also the internal performance which suggests how to achieve the external performance. We propose in this regard the simultaneous use of the Balanced Scorecard tool for managing the internal performance and the Public Service Value Model for measuring the external performance measurement which derives from the organization’s mission. In the second part of the work we analyzed comparatively the external performance created by the county capitals of Romania in the year 2013 using the Public Service Value Model (PSVM). Based on this analysis, the county capitals of Romania can be divided in the following categories: high performance organizations (value driven), budget conscious organizations, low performance organizations (sleeping giants) and quality conscious organizations. This classification is useful both for the external and internal stakeholders because it shows the efficiency of public money spending and the areas in which the LPA is performing well, and also the ones that need to be improved.

Our paper investigates the FDI attracting potential of emerging markets by in terms of their location attributes. We use Statistical cluster analysis to study the dynamic evolution of emerging markets' clusters, based on country attributes that are relevant for the MNEs location decision. We find that countries tend to be grouped at a geographical level or depending on the various resources they possess, except for China that clusters independently. Also, there are numerous countries' transitions from one cluster to another over the years, which indicate a natural process of changing location attributes and market development for many emerging economies.

Using a preliminary investigation and analysis on the latest data on GDP (Gross Domestic Product) performance, GOI (Global Opportunity Index), Vulnerability Score, Readiness Score, and the number of resources of economic importance, exploratory or preliminary SEM (structural equation modelling) was prompted on the recent available data of the 131 countries (n=131). The model was robust, addressing concerns about multivariate assumptions and other measures on the goodness of fit. It was found that the number of natural resources of economic importance plays a large role in the GDP performance. Thus, the preliminary symptom of Dutch disease continues to manifest for as long as each country aims for development, with their resources as ultimate enticing factors for foreign direct investment (FDI). In addition, economic growth is so far observed to be associated with the vulnerability of the country to climate change. Finally, economic growth was found to be linked to the negative impacts argued by the dependency theory. Implication on governance was discussed.

This study seeks to empirically explore the impact of key monetary policy variables on the economic growth in the CEMAC zone from the period of 1981 to 2015. Carried out using the Ex post facto research design based on the principal components selection approach, the study interacts money supply, interest rate, economic growth, and inflation rate, among themselves and their lagged values using the Vector Auto-regressive (VAR) analytical technique. The Classical quantity theory of money, the Cambridge Cash Balanced, the liquidity preference theory and the Monetarists as theoretical frameworks were explored to appreciate the time trends of the selected variables on the economic growth of the CEMAC zone. Based on the (VAR) methodology, the study reveals that key monetary policy variables influence economic growth of the CEMAC zone in different ways with inflation rate as the impact factor. On the basis of the above findings and the evidence from other studies, lending and inflation rate generated substantial destabilizing impacts on the economic growth, suggesting that the monetary authorities should play a critical role in creating an enabling environment for growth. The determination of the optimal lending rate should reflect the overall internal rate of returns in the productive sectors with due attention to market fundamentals. In line with this, the Central Bank of CEMAC should be given complete instrumental autonomy to operate depending on a set of in-built targets by the individual countries of the zone. Effective monetary targeting and accommodating monetary policies should be designed and implemented as the need arises with little or no political motives.

The last four decades have been marked by growing inequality. The inequality of income and wealth is one of the most important macroeconomic issues of our time. Inequality contributed to Global Savings Glut and Global Financial Crisis through riskiness channel and a greater propensity to borrow for poor people. This paper presents evidence that besides structural factors, monetary policy, high leverage and the development of new money substitutes are critical in explaining the inequality trend in advanced countries. Increasing economic inequality acts as financial instability enhancer and if left untreated it poses a significant threat to economic sustainability.

The aim of this paper is to present an analysis whether certain financial ratios can have a significant impact on the development of a stock exchange index. In particular the benchmark stock exchange index is considered, as well as, the selected ratios are considered as the average ones for the whole economy. Quarterly data between 2005 and 2015 were analyzed for the Warsaw Stock Exchange (Poland).

A modern market economy is an exceedingly complex, infinite-dimensional, stochastic dynamical system. The failure of mainstream economists to characterize its dynamics may well be due to its intractability. This paper argues that the characterization of its dynamics becomes almost trivial when it is analyzed from the perspective of infor-mation production. Whether its Jacobian matrix is specifiable or not, a Lyapunov spectrum can be constructed from which the potential Kolmogorov-Sinai or Shannon entropy can be assessed. However, a self-organized equilibrium must first obtain, and for that a suitable policy must be operational.

It is important to determine the dominant fiscal regime in a country group for policy prevision. This paper examines whether the Ricardian fiscal regime or non-Ricardian fiscal regime is dominant in the Common Wealth of Independent States (CIS). We attempted to show that CIS' behavior after the debt stock increase. Using panel data method, this paper finds that Ricardian regime dominates in Kyrgyz Republic, Russian Federation, Tajikistan, Uzbekistan, Moldova and Turkmenistan's fiscal policies.

If the demand under price dispersion is formed by consumers with zero search costs and consumers with positive search costs, the law of one price holds at the equilibrium price level, where the lowest willingness to pay between consumers with zero search costs meets the willingness to accept or to sell of consumers with positive search costs. Consumers with positive search costs maximize their utility with respect to their optimal decisions when marginal losses in labor income during the search are equal to marginal savings on purchase. Optimal decisions move their willingness to accept to the equilibrium price level. Suboptimal decisions of consumers with positive search costs result in willingness to accept below the lowest willingness to pay of consumers with zero search costs and arbitrage takes place. Arbitrage drops down the equilibrium price to the level where willingness to accept of consumers with positive search costs meets the new lowest willingness to pay of consumers with zero search costs and where purchasing decisions of consumers with positive search costs become optimal.

The earnings of the largest professional group financed with public resources, which participates in the realization and financing of the most common and the most expensive public service is the cause of industrial disputes on one hand, and pay aspirations on the other. At the same time the analysis of this phenomenon from the perspective of the public budget as the payer and the scientist-researcher as an analyst often leads to surprising conclusions concerning both the allocation of public means in time and social justice.

The paper proposes that national morality is an important variable for explaining national anti-trafficking policy. It uses cross country regression analysis to see whether or not empirically national morality is a determinant of anti-trafficking policy. The findings of the paper are consistent with the notion that improved levels of national morality lead to better national anti-trafficking policy. National morality is found to be statistically relevant for national anti-trafficking policy when controlling for the extent of democracy, the share of the private sector in the economy, and the degree of globalization.

This research fits into the genre of spatial analysis, aimed at better understanding of population dynamics in relation to the presence and distribution of infrastructure and related services. Specifically, the analysis uses a model of the gravitational type, based on the assumption of the impedance (attractiveness) territorial, based on a curve of type logistics to determine the accessibility of the same, to which to add a system of weights. In this sense, the model was weighted according to the population, to determine the level of “population served” in terms of infrastructure and related services included in the model.

This paper aims to address issues related to equilibrium at the Euro Area. Research methodology implies a wide range of methods and techniques that are used to analyze macroeconomic phenomena and processes at the Euro Area. Following the empirical analyses, namely exploratory factor analysis and structural equation modeling procedure, we propose a model of equilibrium in the Euro zone, an area characterized by the existence of market with turbulence and search frictions. Using this econometric modeling technique, we test and estimate causal relationships that combines a series of empirical data and quantitative causal hypotheses.

The study that represents the subject of this paper follows the analysis of the investment function and the influencing factors at the European Union level. The research has, as a starting point, the hypothesis that there is a negative relationship between the European Union investments and tax rates. For verifying this hypothesis, the structural equation modeling is used (SEM), and the same technique is applied in the second part of the research, which will track the development of the investments' model at the European Union level. The results will highlight the relationships that are established between specific variables that characterize the volume of investments.

The aim of this research is to analyze a short-term risk premium in Poland between 2005 and 2015. In particular one-day periods are considered. It is studies whether the same GARCH type model can be applied for the whole period, or whether the estimated parameters differ significantly for selected sub-periods.

This paper examines the link between real exchange rate volatility and domestic investment by using panel data cointegration techniques. We study the empirical connection between real effective exchange rate volatility and investment for 51 developing countries (23 low-income and 28 middle-income countries). The theoretical relationship between investment and real exchange rate volatility predicts that the effects of exchange rate uncertainty on profits are ambiguous. The empirical results illustrate that real effective exchange rate volatility has a strong negative impact on investment. This outcome is robust in low income and middle income countries, and by using an alternative measurement of exchange rate volatility.

This paper attempts to investigate the effect of fiscal and monetary policy on Indonesian Stock price as well as main sectors stock price such as agricultural, mining, manufacture, and financial sector indexes. We consider the world oil price as a foreign variable that will influence domestic economy as in regular small open economy model. In this paper, we employ the Monte Carlo algorithm to Near-SVAR models (If some of the VAR equations have regressors not included in the others). We find that there is a positive stock price response to monetary policy shock both aggregated and sectoral stock price. In term of interaction between fiscal policy shock and stock market, we find that all sectors respond negative relationship. From this empirical finding, fiscal policy crowd out private sector activity in market, thus, its effect will be impotent in economy. We also provide the evidence that not only both policies are able to influence the stock price individually, but also the interaction between monetary and fiscal policy is important in explaining stock market performance.

A price reversal pattern of ARV drugs was noted across lower and middle income countries in that the lower-income countries have higher prices relative to higher-income countries based on a 2008-2009 Summary Report by World Health Organization. The transaction costs affecting AVR drug pricing can be broadly classified into two kinds: One between the final users and the opinion/knowledge experts, and the other between the opinion/knowledge experts and the manufacturers. Economist's version of price discrimination needs to be modified by including transaction costs. Transaction costs also point to institution creditability factors that will affect NGO procurement.

In this paper it, we have conducted a factor analysis which implied determining the international research directions that have characterized the period following the outbreak of the crisis in 2007 and 2008-2011. In this research, we used secondary data that were extracted from 342 articles, which were based on 665 individual researches. Following this research, we have identified three main research in the macroeconomic areas which explained 56% of all the analyzed research. Also, the results showed the trends in macroeconomic research after the start of the crisis in 2007.

The analysis of the propensity to search specifies the “common” or the ordinary model of consumer behavior based on the synthesis of the neoclassical approach with satisficing concept, and “leisure” and “labor” models of behavior that represent different combinations of conspicuous consumption, leisure, and labor. While the “common model” of behavior demonstrates a moderate propensity to search, “leisure” and “labor” models of consumer behavior exhibit vigorous propensities to search that results in purchase of unnecessary items and therefore in overconsumption. This trend is also presented in home production where vigorous propensity to search takes the form of the vigorous propensity to produce at home. The analysis of trends in allocation of time provides grounds for the assumption that men have more accentuated propensity to search and to produce at home than women that results in overconsumption of unnecessary items.

We investigate the effects of the monetary policy conduct on the domestic capital market for a sample of developed countries where the capital market plays a significant role in the economy. We break down the policy rate innovations in rules-based and discretionary components in order to determine the degree of prudentiality in the monetary policy conduct and we study their accounts with respect to capital market rationality. The rules-based component is determined using an interpolated vanilla Taylor-rule policy rate at the event date and the discretionary component is obtained by subtracting the rules-based rate from the target monetary policy rate innovation. Using an event study approach, we analyze the impact of monetary policy components on the returns of the stock market and we determine that the conduct of the monetary policy can cause irrational responses of the capital market. More than that, we show, for the analyzed countries, that if the general level of discretion in the monetary policy is high the response of the stock market becomes increasingly erratic, indicating that forward guidance may help reduce uncertainty on capital markets.

The aim of this research is to analyze macroeconomic performance and discuss transition indicators in Azerbaijan economy for 1991-2012. After regaining independence in 1991, Azerbaijan implemented economic transition process toward market economy. In the first years of independence, serious economic recession was observed. However, after 1995, the restructuring of the economy started. In this sense, signing the “Contract of the Century” was a turning point toward oil based high speed economic growth or oil boom period. Thus, by opening “Baku-Tbilisi-Ceyhan” pipeline in 2005, Azerbaijan's macroeconomic indicators experienced considerable growth for the following years. On the other hand, Azerbaijan officially declared the end of economic transition process in its economy in 2009. In this paper, the authors discuss the political-economic and economic process in the whole period as well as analyze the macroeconomic performance with and without oil & gas contribution. In addition, the authors question what would happen if economic transition period ended in Azerbaijan's economy. It is concluded that oil & gas production has a serious impact over macroeconomic indicators and transition indicators, and for Azerbaijan it implies only a partly end of economic transition, though not completely.

This article focuses on identifying what are the key sectors with high potential for drag induced investment in the Mexican economy, also characterizes the sectors according to their hierarchy, impact and degree of articulation. To achieve this the input-output matrix national 2003 was used (disaggregated into 20 sectors and 79 sub-sectors), provided by the official government agency responsible for generating statistical information, which applied the traditional method of calculation of multipliers which takes into account both relations hierarchical such as circular between the productive sectors of Rasmussen (1956). The originality of the work lies in the application of the social networks theory to determine (García, Morillas and Ramos 2005, 2008): a) total effects, b) immediate effects, and c) mediative effects of sectors and thus have a full diagnosis of key sectors of the economy under study. In general, the findings indicate that for the promotion of growth and productive development, efforts should focus on manufacturing industries, which means to apply an active industrial policy.

This study examines the relationship between financial liberalization and the advent probability of banking crises because of institutional quality. We used a logit panel data for a sample of fifty developing countries during the period (1990-2014). The results show that there is a positive relationship between financial liberalization and banking crises and the strengthening of institutional quality overcomes the problem of banking crises.

In the history of the modern state of Turkey many policies have been developed and applied in order to transform ineffective economy to a dynamic and steady one. The liberal policies have been effectively applied except for war periods. The main activity of liberal policies in Turkey's economy was conducted on January 24, 1980 with some important structural adjustment decisions. These decisions aimed to integrate the economy with the global system by applying global economic order that widely adopted all over the world. The decisions aimed also to activate a financial liberalization in the country. Financial liberalization generally includes the principles related to the removing the pressure on the interest rate, currency control and investment mobility. More liberalization steps came in 1989 aiming to increase the investment and growth. Foreign Direct Investment (FDI) was seen important for that purposes. However, short term capital flows, having been more effective in real investments than FDI, have led to several negative effects in this period. In the study some of the drawbacks of that process of financial liberalization have been discussed. The relation between FDI and Gross Domestic Product in the financial liberalization process has been tested with econometric implementation. Econometric estimation has been applied for this purpose to test this relationship for post 1980 era for Turkey as a developing country.

This paper presents the analysis of cointegration between offer prices and transactional prices on both primary and secondary local real estate markets. 17 Polish biggest cities are considered and the period between 2006 and 2013. Generally, it is found that primary and secondary markets are not cointegrated.

In various surveys, presence of measurement errors has led to misleading results in estimation of various population parameters. This study indicates the effects of measurement errors on estimates of population total and population variance when samples are drawn using systematic sampling technique from a stratified population. A finite population was generated through simulation. The population was then stratified into four strata followed by generation of ten samples in each of them using systematic sampling technique. In each stratum a sample was picked at random. The findings of this work indicated that systematic errors affected the accuracy of the estimates by overestimating both the population total and the population variance. Random errors only added variability to the data but their effect on the estimates of the population total and population variance was not that profound.

When income growth under price dispersion reduces the time of search and raises prices of purchases, the increase in purchase price can be presented as the increase in the willingness to pay for insurance or the willingness to pay for consumer credit. The optimal consumer decision represents the trade-off between the propensity to search for beneficial insurance or consumer credit, and marginal savings on insurance policy or consumer credit. Under price dispersion the indirect utility function takes the form of cubic parabola, where the risk aversion behavior ends at the saddle point of the comprehensive insurance or the complete consumer credit. The comparative static analysis of the saddle point of the utility function discovers the ambiguity of the departure from risk-neutrality. This ambiguity can produce the ordinary risk seeking behavior as well as mathematical catastrophes of Veblen-effect's imprudence and over prudence of family altruism. The comeback to risk aversion is also ambiguous and it results either in increasing or in decreasing relative risk aversion. The paper argues that the decreasing relative risk aversion comes to the optimum quantity of money.

Since Lėon Walras neoclassical economists hold an inalterable belief in a unique and stable equilibrium for the economic system which however remains to this day unobservable. Yet that belief is the corner stone of other theories such as the ‘Effi-cient Market Hypothesis' as well as the philosophy of neo-liberalism, whose out-comes are also shown to be flawed by recent events. A modern market economy is obviously an input/output nonlinear controllable construct. However, this paper examines four such models of increasing complexity, including the affine nonlinear feedback H∞-control, to show that the ‘data requirement' precludes all attempts at the empirical verification of the existence of a stable equilibrium. If equilibria of complex nonlinear deterministic systems are most likely unstable, multiple or deterministically chaotic depending on their parameter values and uncertainties, then society should impose limits on the state space and focus on endurable patterns thrown-off by such systems.

This paper investigates the effect of the nonzero autocorrelation coefficients on the sampling distributions of the Durbin-Watson test estimator in three time-series models that have different variance-covariance matrix assumption, separately. We show that the expected values and variances of the Durbin-Watson test estimator are slightly different, but the skewed and kurtosis coefficients are considerably different among three models. The shapes of four coefficients are similar between the Durbin-Watson model and our benchmark model, but are not the same with the autoregressive model cut by one-lagged period. Second, the large sample case shows that the three models have the same expected values, however, the autoregressive model cut by one-lagged period explores different shapes of variance, skewed and kurtosis coefficients from the other two models. This implies that the large samples lead to the same expected values, 2(1 – ρ0), whatever the variance-covariance matrix of the errors is assumed. Finally, comparing with the two sample cases, the shape of each coefficient is almost the same, moreover, the autocorrelation coefficients are negatively related with expected values, are inverted-U related with variances, are cubic related with skewed coefficients, and are U related with kurtosis coefficients.

One of the applications of the prospect theory is the behavioral phenomenon of the negative elasticity of the individual labor supply. This paper argues that the negative elasticity of labor supply can be understood better with the help of the interpretation of the Slutsky equation with regard to the common consumption-leisure choice. The interpretation of the Slutsky equation corresponds to the empirical evidence that leisure is a net complement for an important part of consumption.

A hypothesis of uncertain future was created and first applied in the field of utility and prospect theories. An extension of application of the hypothesis to the field of forecasting is considered in the article. The concept of inevitability of unforeseen events is a part of the hypothesis of uncertain future, namely of its first consequence. Partially unforeseen events and their role in forecasting are analyzed. Possible applications of the hypothesis in the field of forecasting are considered. Generally, preliminary preparations of forecast corrections are shown to be able, under specified conditions, to quicken the revisions of forecasts after partially unforeseen events have occurred. Particularly, correcting formulae for forecasts are proposed, including additive-multiplicative formulae. The hypothesis of uncertain future, its consequences and their possible applications are briefly reviewed.

Presently, we cannot find the scientific analysis that clearly explains the deepest roots of global economical and moral crisis. Because of that many famous politicians, economists, sociologists denote the understanding of current situation as the most valuable attainment. Under traditional influence of the doctrine of spontaneous harmony of egoistic individual behavior many economists believe that competition and private property rights through the markets' price mechanism leads in the long run to the Pareto efficiency equilibrium. At the same time the social and economic reality categorically asks to ascertain the market failure and to revision the classical statements of microeconomics. The perfect competition market has lost its attributes due to dialectics of interactions of agents. The investigation of the interactions strategies of the individuals are based on the game theory, what also helps to understand the role of asymmetric information as a specific market failure factor. In the present paper the Martin Shubik classical surviving game is analyzed and some statements of Herbert Gintis concerning this game are critically appraised. The solution of Martin Shubik game in the original geometrical form is offered. The problem of Martin Shubik “does the fittest necessary survive?” is transformed according the case of asymmetric information in problem “does the pretender survive?”, for which the answer “if the agent is not the weakest, but he pretends to be the weakest, than this agent survives with high probability” is offered. The results of the present paper appear to be innovative, not discussed in literature available to the author of the present paper.

After re-gaining its independence on 18 October 1991, the Republic of Azerbaijan started the transformation to the market-based economy and the integration into the world economy. The country s oil and natural gas reserves have been considered the main source for financing a range of government programs for reforms. On the one hand, these reserves had to be used effectively; on the other hand, there was a huge demand for foreign investment for extraction. To this end, Azerbaijan has signed Contract of the Century in 1994. Although Azerbaijan has wide oil and natural gas reserves, it has faced a number of difficulties in its transition path. This study analyzes these problems and reforms for solving them. One of the types of the problems related to the economic structure of the former Soviet Union: disruption of the economic ties between the republics resulted in a decline of production, high levels of unemployment and prices and consequently led to an economic recession in all of the republics. Another set of problems related to the lack of sufficient institutional bases to transform to the market economy. Moreover, internal conflicts between the political parties and groups for having authority as well as political chaos in the republic can be considered other serious problems during the transition period. Furthermore, Karabakh war and occupation of 20 percent of the Azerbaijani territory by the Armenian military forces had made the situation extremely complicated. Despite all of these extremes, Azerbaijan transformed to the market-based economy decidedly and even became one of the fast growing countries of the world. Even in 2013, with the GDP growth rate of 5.6 percent, Azerbaijan was a leader among growing economies. In parallel with this significant economic development, there is still a need for some socio-economic and institutional reforms in order to get a well-functioning market-based economy in Azerbaijan.

The high cost of energy in Jamaica, one of the highest in the Caribbean region, is usually cited as a hindrance to industrial development and efficiency, especially in the manufacturing sector. High energy cost is also considered to be a national energy security issue and the government is taking steps to ensure adequate supply of energy at affordable prices. In the current National Development Plan, the government has set a target for renewable energy sources to supply 20% of the country’s energy need by the year 2030. Using a linear programing model of energy planning, we examine how realistically this target could be achieved. Our findings indicate that the 20% renewable energy target is technically achievable with the optimal plan showing a mixture of wind power, hydropower and bagasse power but no solar power. However, when the timeline for investment in new generating capacities that will ensure the attainment of the target is considered, it becomes highly improbable that the target will be met. This study fills the gap that exists in evidence-based analysis of energy policy in Jamaica.

This study concentrated on local private companies' evaluation to solve crises. It explains the factors that have an effect on these companies success by developing strategies, establishing general budget supporting up their conditions, fair dealing with tax and clear corporate responsibility duties. The companies that get government support may reach their aims of solving the crises or may develop trickeries to get unfair profits besides government support which increases depression. The researcher suggests the use of three tables which will be presented in this study, as models to evaluate the fair general budget policies, the ability of local private companies to get support, and also to evaluate the sharing between companies and government. These tables are important and need to be monitored and can provide direction for companies to a condition which is to cover citizens need locally, at appropriate prices, at a suitable time and place. On another hand, a figure displayed in this research can be used to watch a company's reaction in crises.

There is now considerable disquiet about the appropriate monetary strategy that central banks should follow in the aftermath of the global financial crisis. Several influential commentators have called for the abandonment of inflation targeting. Empirical research examining three major economies demonstrates that inflation targeting was effective prior to the crisis and a more flexible form of targeting may still be appropriate after the crisis.

This paper studies dynamic interdependence among physical capital, resource and human capital. We integrate the Solow one-sector growth, Uzawa-Lucas two-sector and some neoclassical growth models with renewable resource models. The economic system consists of the households, production sector, resource sector and education sector. We take account of three ways of improving human capital: Arrow's learning by producing (Arrow, 1962), Uzawa's learning by education (Uzawa, 1965), and Zhang's learning by consuming (Zhang, 2007). The model describes a dynamic interdependence among wealth accumulation, human capital accumulation, resource change, and division of labor under perfect competition. We simulate the model to demonstrate existence of equilibrium points and motion of the dynamic system. We also examine effects of changes in the productivity of the resource sector, the utilization efficiency of human capital, the propensity to receive education, and the propensity to save upon dynamic paths of the system.

The aim of this article is to provide some general information about entrepreneurship and some insights on the early theories about it. A brief overview of the main entrepreneurship measurement programme will provide some facts about the evolution of the entrepreneurial activity in Romania in the last few years.

The International Monetary System (I.M.S.) has a crucial role in economy, representing the frame for a sustainable development of the economic relationships between states, while contributing at the progress of the world's economies. Nowadays, this system confronts large difficulties, as a consequence of the lack of financial disciplinary instruments, meant at regulation and coordination. The actual economic-financial crisis proved the limits of the present I.M.S., reason why it is now under “reconstruction”. In this direction, there is a series of reforms that can be implemented, so that the new architecture of the system is much more solid.

The impact of the crises on national economies represented a subject of analysis and interest for a wide variety of research studies. Thus, starting from the GDP composition, the present research exhibits an analysis of the impact of European economies, at an EU level, of the events that followed the crisis of 2007 2008. Firstly, the research highlighted the existence of two groups of countries in 2012 in European Union, namely segments that were compiled in relation to the structure of the GDP's components. In the second stage of the research, a factor analysis was performed on the resulted segments, that showed that the economies of cluster A are based more on personal consumption compared to the economies of cluster B, and in terms of government consumption, the situation is reversed. Thus, between the two groups of countries, a different approach regarding the role of fiscal policy in the economy can be noted, with a greater emphasis on savings in cluster B. Moreover, besides the two groups of countries resulted, Ireland and Luxembourg stood out because these two countries did not fit in either of the resulted segments and their economies are based, to a large extent, on the positive balance of the external balance.

The investment takes the form of sums of money spent for the acquisition of capital goods, changes in business inventories, and the purchases of new residential housing that are not currently consumed, but will be used in the future for the growth of the wealth. The work covered by this study aims to identify the model that presents, in the best possible way, the method of investment’s calculation and to determine the factors of influence. In the first part, the investment is analyzed as a linear function dependent on the interest rate; and the second part implies a new model for determining long-term investments.

It is with great pleasure that I introduce the first issue of Expert Journal of Economics! This journal adopts an open source approach to publication and promotes research as a cooperative endeavor between authors, editors, referees, and readers. Expert Journal of Economics will publish papers covering a range of topics, the common theme being the role of economic policy in economic outcomes.