The effectiveness of fiscal and monetary policies in a small open economy – the case of Macedonia

Petrevski, Goran; Trenovski, Borce; Tashevska, Biljana

doi:10.1080/14631377.2019.1607437

Cited by 5 publications

(3 citation statements)

References 39 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…In contrast, the causal link between the two variables (fiscal policy and competitiveness) shows that fiscal policies positively influence competitiveness for all countries, but the reverse is achieved only for the least developed countries among the eleven. One possible explanation would be that Poland and the Czech Republic are more economically developed, and their economies are more anchored to European economies and so the exchange rate can no longer influence the level of fiscal policies (Petrevski et al, 2019).…”

Section: Discussionmentioning

confidence: 99%

Competitiveness, fiscal policy and corruption: evidence from Central and Eastern European countries

Ţigănaşu

Pascariu

Lupu

2022

View full text Add to dashboard Cite

Research background: The transformations induced by global challenges call for new approaches towards competitiveness and thus require a consistent rethinking of strategies and mechanisms so that they could be better adapted to the constantly changing context. Prior to the European Union (EU) accession, the Central and Eastern European (CEE) states began a broad process of economic reforms, including trade liberalization, mass privatization, exchange rate liberalization, all of which led to a wider opening to new markets, the creation of new opportunities for production and to ensuring the competitiveness of companies on foreign markets. By far, the most important step in the post-communist period was joining the EU, achieved after 2004. Over time, these states have faced, on the one hand, issues related to addressing systemic vulnerabilities, and on the other hand, finding the most appropriate measures to induce competitiveness. The influence of public policies on competitiveness is still an issue that needs to be debated, our study proposing to examine the reaction of external competitiveness to the increase of government spending and corruption. Purpose of the article: The aim of this paper is to analyze the impact of fiscal policies and corruption on the external competitiveness of the eleven countries from Eastern Europe (Bulgaria, Croatia, Czechia, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia) for the period 1995?2020. The choice of this time interval is to better capture the trinomial relationship between competitiveness, fiscal policy and corruption before and after the process of integration of the CEE states into the EU. Methods: The methodology chosen is based on ARDL (Autoregressive Distributed Lag) with structural breaks, the period taken into account being 1995?2020. The Unit root test of augmented Dickey?Fuller ADF (2016) was used to assess the time series stationarity. The test developed by Bai and Perron (2003) is applied to detect structural breaks, by resorting to the LM test. The tests for the cointegration between the considered variables, using the ARDL model, proposed by Pesaran et al. (2001), were also part of the research. The causality test of Granger et al. (2000) was used to assess the conditionality between the indicators. By applying these methods, it was highlighted that, especially after 2007, in the states under analysis, expansionary fiscal policies have led to internal devaluations of the currency, which ultimately increased external competitiveness, measured as real effective exchange rate. Instead, corruption has a negative impact on competitiveness. Findings & value added: The obtained results point out the relationship between competitiveness, fiscal policy and corruption in CEE countries. In the case of those that have a high competitiveness, even if there are large government expenditures, there is also an economic environment conducive to the implementation of measures that generate added value on a large scale. Conversely, in countries where corruption is high, the impact of government fiscal policies on competitiveness is reduced due to the negative effects caused by this phenomenon. Our study brings at least two contributions to the literature. First of all, the research shows how a growth in public spending affects the competitiveness of CEE economies through the real exchange rate. Secondly, it takes into account the phenomenon of corruption applied to Eastern countries, emphasizing a decrease in the external competitiveness of these economies in response to the manifestation of corruption.

show abstract

Section: Discussionmentioning

confidence: 99%

Competitiveness, fiscal policy and corruption: evidence from Central and Eastern European countries

Ţigănaşu

Pascariu

Lupu

2022

View full text Add to dashboard Cite

show abstract

“…The VAR methodology is often used for analysing the interactions and the effects of the economic policies and enables us to detect the effects, the interaction and the transmissions of the shocks of important economic policies by using the impulse response function. All this is done without the need to include a lot of restrictions in the model and enables the data to manifest the mutual dynamics and transmissions among the variables in the model (Petrevski, Trenovski and Tashevska, 2019). In the VAR models all variables are treated as endogenous and dependent in both a static and a dynamic sense and the panel VAR models have the same structure as the basic VAR models, although the cross-section component adds a new dimension to the model (Canova and Ciccarelli, 2013).…”

Section: Methodsmentioning

confidence: 99%

Untitled

2023

pse

View full text Add to dashboard Cite

show abstract

“…Berkaitan erat dengan kebijakan bank sentral tentang penurunan tingkat suku bunga hingga mendekati nol dan penundaan pembayaran utang akan menyebabkan bubble ekonomi yang tidak berkesudahan karena mereka sebenarnya menggunakan kebijakan pada saat yang tidak tepat. Sebagai konsekwensinya bank sentral akan memikul tanggung jawab atas bubble ekonomi yang akan meledak kecuali jika didukung oleh kebijakan fiskal yang solid dari pemerintah (Friedman, 1960).…”

Section: Kebijakan Fiskal Kerajaan Arab Saudiunclassified

Kebijakan Ekonomi Arab Saudi Dalam Mengantisipasi Pandemi Covid-19

Sikki

2020

JIC

View full text Add to dashboard Cite

Penelitian ini menganalisis kebijakan ekonomi Arab Saudi dalam mengantisipasi efek Covid-19 terhadap perekonomian nasional-nya. Kebijakan-kebijakan ini mencakup kebijakan ekonomi internasional, kebijakan fiskal, dan kebijakan moneter. Upaya kerajaan Arab Saudi dalam kebijakan ekonomi internasionalnya untuk menyalurkan donasi ke WHO sebagai organisasi kesehatan dunia dalam rangka mencegah pandemi coronavirus dan kebijakan fiskal nasionalnya melalui intervensi pemerintah dalam meningkatkan pengeluaran anggaran dan menunda pembayaran pajak adalah komitmen vital untuk mengamankan ekonomi global dan umat manusia. Di lain pihak, kebijakan moneter diperlukan untuk menstabilkan perekonomian dengan mendukung kebijakan fiskal yang solid ketika dunia global ddibanjiri likuiditas seperti tingkat bunga nominal yang mendekati atau di bawah nol sehingga berdampak pada penurunan suku bunga dapat memicu keluarnya uang tunai dari pasar saham. Dalam hal ini Kerajaan Arab Saudi sangat cepat dan tanggap dalam menjalankan kombinasi kebijaka-kebijakan tersebut.

show abstract

The effectiveness of fiscal and monetary policies in a small open economy – the case of Macedonia

Cited by 5 publications

References 39 publications

Competitiveness, fiscal policy and corruption: evidence from Central and Eastern European countries

Competitiveness, fiscal policy and corruption: evidence from Central and Eastern European countries

Untitled

Kebijakan Ekonomi Arab Saudi Dalam Mengantisipasi Pandemi Covid-19

Contact Info

Product

Resources

About