Nenad Stanišić
One of the main expectations in European transition economies is that the processes of building the market economy and European integrations lead to a significant increase in the living standard, as well as to catching up with the level of the income per capita achieved in developed European economies. A quarter century after the beginning of transition, many of the former socialist countries joined the EU and significantly increased their GDP per capita. On the other hand, transition in the countries of the so-called Western Balkans has disappointed in this sense. The paper tests the existence and speed of income convergence in the Western Balkan states and developed EU countries, in comparison with the so-called „New Member States”. The results indicate that, despite the achieved income convergence in the pre-crisis years, the outbreak of the global economic crisis has revealed many structural and reform problems that the countries of the region have been facing for a long time. Catching up with developed EU members’ average GDP per capita stopped in the Western Balkan states after the beginning of the crisis, with a simultaneous increase in the income gap between the Western Balkan states and the new EU member states.
Nataša Golubović and Marija Džunić
The design and implementation of the measures aimed at incorporating informal economic activities into the existing formal regulatory framework assume the knowledge of the causes and structure of the informal activity. The influence of the institutional factors that encourage the development of the shadow economy (the tax burden, the degree of the regulation of the economy, the capacity of the state administration) were the subject of extensive theoretical and empirical research. In contrast, the impact of social capital, i.e. the characteristics of social ties and relations, on the shadow economy has been investigated to a much lesser extent. Starting from the fact that the informal sector of the Serbian economy is so widespread that it represents a serious obstacle to the business activities of Serbian enterprises, the aim of this study is to investigate whether the characteristics of social ties and relations, or social capital in the Republic of Serbia (RS), represent a fertile ground for the growth of the shadow economy. In this context, the characteristics and frequency of social contacts, particularized trust and institutional trust will be separately analyzed as the determinants of the shadow economy in RS.
Nenad Janković
The concept of a twin deficit relates to a budget deficit and a current account deficit. In the literature, there is no unique answer to the question of what the causal relationship between these deficits is. In any case, the existence of these deficits indicates that the spending of a country is higher than its production and investments are greater than savings. The form of financing could be a potential problem, as well as the manner of the use of these funds. Crisis situations contribute to the increasing importance of the issue. In these situations, those countries where a budget deficit chronically appears and which do not have enough domestic savings to finance excessive government spending will be in a worse position. The Republic of Serbia (RS) belongs to the group of countries where a budget deficit is a chronic phenomenon financed by external sources; therefore, the paper will analyze the issue of a twin deficit.
Yuan Xiaoling and He Bin
Given the fact that the existing evaluation and analysis of urban efficiency are negligent of external negative effects on the environment in the medium and long term, this paper constructs an SBM – an undesirable model containing an undesirable output, measures the urban efficiency of 285 cities in China at or above the prefecture level during 2003-2012, decomposes it into urban pure technical efficiency and urban scale efficiency and makes a comparative analysis of them separately. The results show that, when the environmental factors are taken into account, the level of urban efficiency in China is low, but is a large room for it to improve. The impact of the decomposition of urban scale efficiency on urban efficiency is continuously enhancing. From a regional perspective, urban pure technical efficiency is the highest in the eastern region, only to be followed by the western region, whereas it is the lowest in the middle region. From the point of view of the scale, urban pure technical efficiency represents a „U-type” change and urban scale efficiency represents an „inverted U” change. Therefore, this paper suggests that in order to improve urban efficiency, we should adopt different urban development policies for cities located in different regions and on different scales.
Vlastimir Leković
The research, focusing on the specific key aspects of economic inequality as well as economic equality, by analyzing numerous theoretical, methodological and empirical views concerning the mentioned socioeconomic phenomena, aims to identify the following related and relevant aspects that affect the efficiency of the functioning of a modern economy: a) economic inequality that has a stimulating effect on the creative, productive and innovative use of all production factors positively affects the functioning of the economy and is socially justifiable; b) a high level of economic inequality, which shows a tendency to further increase, has a negative effect on the economic system indicators as well as the stability of the society and the political environment, therefore resulting in a weaker economic performance and a lower economic growth rate; c) economic equality (certainly not egalitarianism), by contributing to greater social and political stability, which in turn reflects positively on economic stability and efficiency, is the basis for a greater success of the modern economy and dynamic economic growth rates. The main result of this study is assessing the basic factors of high and rising economic inequality and its implications for the functioning of modern economies, and accordingly, pointing to the need to implement economic policies that would lower economic inequality and mitigate its adverse consequences for the economy and the society.
Miroslav Todorović, Đorđe Kaličanin and Aleksandra Nojković
A large number of acronyms which indicate diff erent performance metrics, such as EBIT (Earnings Before Interest And Taxes), EBITDA (Earnings Before Interest, Taxes, Depreciation, And Amortization), ROIC (Return On Invested Capital), NPV (Net Present Value), EVA (Economic Value Added), IRR (Internal Rate Of Return), ROE (Return On Equity), ROA (Return On Assets) etc. are in use nowadays. In practice, managers cannot and do not want to apply all of these metrics and managers’ choice does not necessarily rely on what theory emphasizes as their advantages and disadvantages. We surveyed 64 CFOs in order to explore the corporate practice in the Republic of Serbia. The DCF-based capital budgeting metrics are dominant compared to the traditional metrics, and the one that is used the most is the profi tability index, only to be followed by the IRR and the NPV. The Payback Period is yet frequently used. The earnings-based corporate performance metrics are still the most important. However, the presence of EVA and balanced scorecard is not negligible. Large companies use them signifi cantly more than small companies. The orientation towards EVA and balanced scorecard increases with the internationalization of a fi rm as well. Finally, companies using sophisticated capital budgeting metrics are prone to using sophisticated corporate performance metrics.
Fang Ying1 and Zhao Wen-ping2
In recent years, the worsening of the quality of the air has urged more people to att ach great importance to circular economy. Shaanxi, abundant in natural resources, maintained the GDP growth rate of 14.9% during the period of the twelfth fi ve-year plan. However, the fast economic growth under the extensive traditional economic growth mode renders Shaanxi inadequate in resources supply and noticeably worse in ecological environment issues. With the method of the IPAT equation, this paper quantitatively analyzes the developmental stage and the developmental level of the circular economy of Shaanxi to cover the shortage of the previous studies having only been focused on the policy study and the practice mode. The result shows that Shaanxi is in the intermediate stage of circular economy and the advanced stage has an apparent advantage over the intermediate one by comparing their energy consumption and solid pollutant discharge. The development experience of Shaanxi, a typical province of China, has guidance and reference signifi cance to China and other developing countries.
Vladimir Mićić
This paper examines industrialization and structural change induced thereof, which are the main drivers and bearers of economic development. The author observes that the industry of the Republic of Serbia is devastated due to sudden and premature tertiarization as well as inadequate reforms. The current structures of both the economy and the industry do not have a sufficient capacity to ensure sustainable economic development; hence, the aim of the research presented in this paper is to emphasize the importance of reindustrialization and the implementation of structural changes in the Republic of Serbia. The paper starts from the premise that industry is the main driver and the bearer of economic growth and development. Therefore, it is necessary for the Republic of Serbia to turn to reindustrialization and implement structural changes in this sector given the fact that the levels of the development and competitiveness of the industry are correlated to the intensity of industrialization. The research findings indicate that developed industrial countries are characterized by more effective structural changes and more propulsive production that creates higher value-added products. This reflects not only at the level of the industrial development but also at the level of the competitiveness, volume and quality of exports.
Fan Xiufeng, Liu Bolong and Liu Qiong
This article is based on the years from 1991 to 2012 of the nine categories of the provincial pollutant discharge indexes of China, uses the „vertical and horizontal method“ to calculate the comprehensive indexes that can fully measure the provincial pollutant discharge situation of China, establishes a dynamic inter-provincial panel data regression model and makes an empirical test on the relationship among foreign direct investments, foreign trade and pollutant discharge these three factors. The results show that foreign direct investment and foreign trade in diff erent regions have a diff erent impact on pollutant discharge. Therefore, local governments should at all levels be based on local conditions to att ract foreign investment and develop foreign trade for the targeted optimization of the structure of introducing foreign investment and improving the quality of foreign trade growth, thus improving the overall situation of China’s pollutant discharge.
Fatih Burak Gümüş1 and Feyyaz Zeren2
The efficient market hypothesis is one of most important theories in finance and one of the most important research areas for both developed and developing stock markets. In this study, the random-walk hypothesis is tested for the main stock markets of the G-20 countries. The linearity of the series is determined in the first stage. In this context, 16 of 17 markets have a linear structure; therefore, the Fourier ADF unit root test that uses trigonometric functions in order to capture deviations greater than the average of the dependent variable and takes into account multiple structural breaks, is applied to these series. Furthermore, the Fourier KSS unit root test that has the same functions as the Fourier ADF unit root test is used for the Japanese stock market, being the only one market with a non-linear structure. As the result of these analyses, while the markets of the nine countries are observed as effective in the weak form, this hypothesis is not valid for the remaining eight countries. While the prediction of the future price of all of these nine markets will be impossible through a technical analysis, investors in the remaining eight markets can provide returns by carrying out the same analysis.