A growing body of literature reports evidence of social interaction effects in survey expectations. In this note, we argue that evidence in favor of social interaction effects should be treated with caution, or could even be spurious. Utilizing a parsimonious stochastic model of expectation formation and dy- namics, we show that the existing sample sizes of survey expectations are about two orders of magnitude too small to reasonably distinguish between noise and interaction effects. Moreover, we argue that the problem is com- pounded by the fact that highly correlated responses among agents might not be caused by interaction effects at all, but instead by model-consistent beliefs. Ultimately, these results suggest that existing survey data cannot facilitate our understanding of the process of expectations formation.
The economic crisis has brought a new situation also for the Hungarian economic
policy, as neoliberalism as the main trend in economic thought is no
longer valid. This phenomenon cannot be reduced to be a mere macroeconomic
course shift, as an entire economic philosophy and approach has lost its relevance.
One consequence of this is the need for a thorough revision of the theory
and practice of business management, along with the re-evaluation of the notion
and position of the corporation.
Our study aims to contribute to this theoretical reformation, presenting that social
values derived from psychological and sociological findings such as human
motivational theories or trust are fundamental elements of the 21st century corporate
model. To point to this, we use the ideological correspondences, while
proving that our national research on corporate theory and even rather its application
are far behind the 21st century requirements and lack even the Western
view of the 20th century.
The market structure can be described by concentration ratios based on the
oligopoly theory or the structure – conduct – performance paradigm. Measures of
concentration and also competition are essential for banks conduction in the
banking industry. Several researchers have proved concentration level to be major
determinants of banking system efficiency. Theoretical characteristics of market
concentration measures are illustrated with empirical evidence. The market
structure of the Albanian Banking Sector has changed dramatically in recent years.
On 1990s, our country has experienced deregulation, foreign bank penetration, and
an accelerated process of consolidation and competition in the banking sector.
Particularly, the working paper examines the nature and the extent of changes in
market concentration of Albanian banking sector. It focused primarily on a
descriptive and dynamic analysis of change in the concentration indices in banking
sector from year to year. Also it examines how the inherited structure of the
banking system affects the way of the distribution of market shares amongst the
different banks that comprise on the banking sector.
Dieser Artikel zeigt, dass eine Subvention der heimischen Kreditzinsen zu einem
Rückgang der Auslandsverschuldung führen kann. Ausgehend von der Mittelwert-
Varianz- und der Erwartungsnutzentheorie wurde ein Modell entwickelt, in dessen
Rahmen der Wirtschaftsakteur sein internationales Kreditportfolio optimiert.
Eine Einbeziehung der Zinsparitätenbedingung war in der Analyse jedoch nicht
zielführend. In den Modellrahmen wird eine staatliche Zinssubvention eingeführt
und ihre theoretische Wirkung auf die Fremdwährungsverschuldung der Haushalte
The phenomena of manipulation of the economy by the incumbent for electoral
purpose are called Political Business Cycles (PBC), introduced by Nordhaus (1975). Using
policy control economic instruments, as fiscal and monetary instruments, government may
manipulate the economy to gain electoral advantage by producing growth and decreasing
unemployment before elections.
In addition to increased public expenditures, also the production/supply of certain
publicly provided goods may score improvements. In Albania, production and supply of
electricity (for the time span of our analyzes) was controlled by KESH (Korporata
Energjitike Shqiptare – Albanian Energy Corporation) which is a quasi- monopoly in the
supply of electricity in Albania, and it is publicly run. Throughout the transition, supply of
electricity, due to various technical and economic reasons, has not been stable, and
characterized by systematic interruption for households and businesses users, affecting
their well-being and performance (electricity is a main source of energy for households,
including heating and cooking). Therefore, it seems so that there is an incentive and
rationale for the incumbent to use also the provision of electricity to impress the voters
before elections, beside of the classical instruments of expenditures.
In this paper we analyze consumption, production and import of electricity in Albania.
Our hypothesis is that before elections, electricity consumption may increase above usual
levels, followed by a contraction after elections. In our analysis we use modern standard
econometric approach, used widely for research related to PBC. By ARMA modelling it is
possible to prove if elections can explain changes in electricity production, in addition to
the past history of the variable and the random error term.
Macedonia's economy was not left behind by the global economic crisis as the
country's macroeconomic policymakers had hoped! Certainly, an economy open at
all and with a high degree of direct dependence on European and global economies
in general should not be saved by the crisis in financial top and then the global
economic. Transmission of negative effects but came a little late economic shocks
in the periphery are often stronger than the epicenter. In these circumstances
macroeconomic policymakers should be more proactive, coherent and dynamic
design of the following measures and economic policies increasingly based on
relevant research and analysis (decision making based on research and analysis).
Therefore, this analysis aims to develop and study in detail the measures in terms of
economy, Science and Technology of Macedonia in order to suggest a more
effective policy in accordance with business cycles, always comparing the
economic measures in other states with which the country has advanced reports on
economic but referring to specific local economic conditions. Accordingly the
specific activities recommended for further action.
The paper enlightens popular part of the budget policy – deficit finance. In the
process of securing economic conditions to surpass the current economic crises,
the governments all over the world incline towards debt deficit finance. The
intention is to describe the implications such as multiplier effect, crowding out
effect, correlation between budget and trade deficit. One of them are positive, they
increase the aggregate demand and national income, other negative in term that
they crowd out the private sector from the capital market under increased demand
for loanable funds.
In this paper we integrate heterogeneous inflation expectations into a simple monetary
model. Guided by empirical evidence we assume that boundedly rational agents, selecting
between extrapolative and regressive forecasting rules to predict the future inflation rate,
prefer rules that have produced low prediction errors in the past. We show that integrating
this behavioral expectation formation process into the monetary model leads to the
possibility of endogenous macroeconomic dynamics. For instance, our model replicates
certain empirical regularities such as irregular growth cycles or inflation persistence.
Moreover, we observe multi-stability via a Chenciner bifurcation.
The paper examines the relationship between the political system and the public administration
modernization in the Hungarian transition. Its intention is to point out that there are various
shortcuts and bottlenecks of the Hungarian modernization and the cumulative impacts of these
deficiencies have caused characteristic difference of the Hungarian modernization trajectory
from the typical Western trajectories.