The primary factors that were initially assumed to contribute to a decline in household income were job losses, which affect the decrease in consumption (Organisation for Economic Co-operation and Development [OECD], 2020; Doerr & Gambacorta, 2020). Kosovo’s government has taken measures of social distancing, having a major impact on households such as the impact of dismissal due to the closure of businesses indefinitely. This regime is continuing from the different waves of COVID-19 variants and the family income as it goes and decreases. Therefore, the purpose of this study is to measure the impact of the COVID-19 pandemic on household income including household consumption and savings for the years 2020–2021. The study uses a quantitative research method, thus, for primary data collection, the online questionnaire is used. The latent variable in this paper is the COVID-19 pandemic, while the factors that determine the latent variable are: savings, job loss, family income before the pandemic, and consumption expenditures. The study concludes that COVID-19 has a negative and significant impact on family income, saving, job loss, and consumption expenditures. The results from the structural equation modeling (SEM) are significant and the likelihood ratio (LR) test is 47.46. These findings and those of Martin, Hallegatte, and Walsh (2020), Dossche, Kolndrekaj, and Slacalek (2021), and Bundervoet, Davalos, and Garcia (2021) are consistent.

This paper analyzes the relationship of macroeconomic factors to the level of non-performing loans (NPLs) using the econometric models GMM, the Fixed Effect model, and the Random Effect model. This study aims to identify macroeconomic factors at the level of non-performing loans in the Western Balkans, measure their impact on non-performing loans, and thus fill the gap that exists between macroeconomic factors (consisting of economic growth) and those with more impact on NPLs. The methodology used to carry out this research was desk research. We used World Bank data from 2000–2019, processed with STATA software. Results show that macroeconomic factors have an impact on non-performing loans. It also proves that even when interacting with other variables, the level of bad debt has not been completely eliminated, despite economic growth in many countries. Third, throughout the study period, fixed effects estimates show that variables are not significant in a static context. According to the findings, the annual rates of GDP growth, final government consumption, the real interest rate, gross domestic savings, and the unemployment rate all have a favorable impact on NPLs. This research contributes to a deeper understanding of the relationship between macroeconomic factors and non-performing loans in the Western Balkans. Based on this, to help reduce loan risk and bad debt by the proper criteria, we propose a series of policy implications. These implications aim to improve the efficiency of banks in particular and the banking system as a whole. Doi: 10.28991/ESJ-2022-06-05-08 Full Text: PDF

The Keynesian theory states that economic growth is positively affected by government spending, while Classical theory states that economic growth is negatively affected by government spending, as is stated by neoclassical public choice theorists (Nyasha & Odhiambo, 2019). Based on these theories, many authors have carried out research on the impact of economic freedom on economic growth by analyzing various empirical cases. Bergh and Karlsson (2010) with the findings from his paper confirmed that the countries with the highest government size have an elevated growth in the globalization index of KOF and the Fraser Institute’s economic freedom index. The main aim of this paper is to analyze the government size impact on the growth of the economy in the Western Balkan in the time period 2000–2017 according to Fraser Institute’s data, incorporating the following econometric models: fixed and random effects, pooled ordinary least squares (OLS), and Hausman-Taylor IV. With these models, this paper analyzes a government size and its components: government enterprises and investment, government consumption, transfers, and subsidies. The results illustrate a relationship between the size of the government and the growth of the economy in the Western Balkans that is positive. 1% increase in government size affects 0.29% gross domestic product (GDP) growth per capita. According to the Hausman-Taylor instrumental variable, 1% growth of government consumption is affected by 0.69% the decline in GDP per capita. The growth rate of transfers and subsidies affects 0.17% of GDP growth per capita and 1% of government enterprises and investment affects 0.54% GDP growth per capita.

The problem of youth unemployment has started to receive attention in a relevant way recently, especially in Europe, where the percentage of unemployment registered for this category of the population is relatively greater than that for the adult population (Perugini & Signorelli, 2010), also being influenced by the last financial crisis (Choudhry et al., 2012). Youth unemployment is a critical social issue because it is linked to a number of aspects of society (Yamamoto, 2011). The purpose of the treatment of this paper is to identify the barriers faced by the young people of Kosovo to enter the labor market. The study uses the quantitative research method, through the use of an online questionnaire, a survey was participated by 496 respondents. The econometric model used in this study is the structural equation model (SEM). The empirical results from the SEM model show that the most important factor is the lack of work experience, which is a barrier to the employment of young people in Kosovo. The results of this paper are important to understand the importance of effectiveness in the design of policies for the elimination of barriers to the employment of young people in Kosovo.