In this paper, the author finds links among changes in private and public debt during economic downturn and discusses their financial stability and fiscal sustainability consequences. Financial deepening in years before the economic downturn resulted in the growth of indebtedness among agents within economy that sustained afterwards. The European Union has not become less indebted during and after the economic meltdown, but the structure of debt holders has changed. The growth of private debt in the upturn phase resulted in a qualitatively new level of economy. However, in order to sustain the same level after the economic downturn, the public sector was forced to increase its debt. As a result, interactions among financial stability and fiscal sustainability have become more pronounced as monetary financial institutions experienced deleveraging from the private sector and an increase of leverage from the public sector. Thus, the financial stability and fiscal sustainability nexus is analysed by employing flow-of-funds data that show balanced interlinkages among real and financial flows. Recent discussions on sovereign debt instability and suggestions to diminish public debt whatever it costs lack an appropriate answer who will replace it as the flow-of-funds in economy is always in balance.
Almost all, without any exceptions, European Union countries face the threats in obtaining supplies of energy resources. In the light of it, the European Union implements an energy policy that helps in pursuing to solve energy security problems, but the latter is often facing challenges and achieved results are often weak compared to the dynamic environment. Considering the fact that consumption of energy will grow in the future, while volumes of production will grow, despite the rapid development of the modern technologies used in energy sector, in the political map of the world wee will see more countries dependent on energy imports and having negative energy balances. Thus, in the future the weight of energy supply security ensuring issue in agenda of international relations will maintain its relevance and will be of particular interest to the European Union, seeking to strengthen its competitiveness. This reflects the problem of this work. This work – Estimation of the changes in security of energy resources supply: the case of European Union – aims to fill an analytical gap existing in the energy policy. The objective of this Master's work is to assess the security of energy supply in the European Union and to propose direction of its increase. In order to achieve the Master's work objective there are set the following tasks: 1. To define meaning of the energy supply security in the theoretical context; 2. To formulate a model for the energy supply security assessment; 3. Employing formulated model to evaluate the security of energy supply changes in the European Union; 4. Through the evaluation results reveal the directions of enlargement of energy supply security. Master's work covers the subject of energy supply security assessment in the European Union. In the work there are applied different methods of research: a theoretical analysis, comparison, evaluation, modeling, statistical and mathematical calculations, interpretation. Analytical study in this Master's work has covered the subject of the distribution of trade (import and export) with the main energy resources (oil, gas, coal) by trade partner of twelve European Union countries. In this work the estimated the weight of energy resources in the national and international agenda justifies the importance of this factor to transformation of present and the future world. The approach of research, which to a significant extent is based on proposals submitted by E. Gnansounou, is supplemented and integrated by alternative indicators, which provide a model with theoretical value and extends the possibilities of using empirical data. It should be noted that in the master's work employed research without significant restrictions could be used in assessing the vulnerability not only of the import of energy resources, but also the threat arising from the acquisition of other resources in foreign markets. This underlines and extends the boundaries of the practical applicability of the model constructed in this work. In the author's opinion, the work reflects the theme formulated, the established objective and tasks are reached. The construction of a relatively specific analytic access required introducing a valid creative input and interdisciplinary assessment, that emphasizes scientific value and theoretical significance of the work. In the future, researches on energy supply security could be to enriched by analysis of investment into energy supply security, because the question on the balance between the costs for security enforcement and other areas remains open. Also, in order to diversify the markets there remains uncertain benefit of selected economic directions, the strength of external suppliers' interrelationships. These mentioned issues could be identified as issues for future researches pursuing to enhance the assessment of energy supply vulnerability.
Almost all, without any exceptions, European Union countries face the threats in obtaining supplies of energy resources. In the light of it, the European Union implements an energy policy that helps in pursuing to solve energy security problems, but the latter is often facing challenges and achieved results are often weak compared to the dynamic environment. Considering the fact that consumption of energy will grow in the future, while volumes of production will grow, despite the rapid development of the modern technologies used in energy sector, in the political map of the world wee will see more countries dependent on energy imports and having negative energy balances. Thus, in the future the weight of energy supply security ensuring issue in agenda of international relations will maintain its relevance and will be of particular interest to the European Union, seeking to strengthen its competitiveness. This reflects the problem of this work. This work – Estimation of the changes in security of energy resources supply: the case of European Union – aims to fill an analytical gap existing in the energy policy. The objective of this Master's work is to assess the security of energy supply in the European Union and to propose direction of its increase. In order to achieve the Master's work objective there are set the following tasks: 1. To define meaning of the energy supply security in the theoretical context; 2. To formulate a model for the energy supply security assessment; 3. Employing formulated model to evaluate the security of energy supply changes in the European Union; 4. Through the evaluation results reveal the directions of enlargement of energy supply security. Master's work covers the subject of energy supply security assessment in the European Union. In the work there are applied different methods of research: a theoretical analysis, comparison, evaluation, modeling, statistical and mathematical calculations, interpretation. Analytical study in this Master's work has covered the subject of the distribution of trade (import and export) with the main energy resources (oil, gas, coal) by trade partner of twelve European Union countries. In this work the estimated the weight of energy resources in the national and international agenda justifies the importance of this factor to transformation of present and the future world. The approach of research, which to a significant extent is based on proposals submitted by E. Gnansounou, is supplemented and integrated by alternative indicators, which provide a model with theoretical value and extends the possibilities of using empirical data. It should be noted that in the master's work employed research without significant restrictions could be used in assessing the vulnerability not only of the import of energy resources, but also the threat arising from the acquisition of other resources in foreign markets. This underlines and extends the boundaries of the practical applicability of the model constructed in this work. In the author's opinion, the work reflects the theme formulated, the established objective and tasks are reached. The construction of a relatively specific analytic access required introducing a valid creative input and interdisciplinary assessment, that emphasizes scientific value and theoretical significance of the work. In the future, researches on energy supply security could be to enriched by analysis of investment into energy supply security, because the question on the balance between the costs for security enforcement and other areas remains open. Also, in order to diversify the markets there remains uncertain benefit of selected economic directions, the strength of external suppliers' interrelationships. These mentioned issues could be identified as issues for future researches pursuing to enhance the assessment of energy supply vulnerability.
The problem of real estate price bubble is analysed in relation to the development and growth of the economy of Lithuania. By evaluating theoretical and practical-historical aspects of formation of the housing prices' bubble, as well as the opinion of renown experts of the country, the formation of the present situation is substantiated by specifying economic and psychological reasons (it is accentuated that these factors tendentiously influence the market of real estate in Lithuania). More than once the historical guidelines of many countries had disclosed the threat of real estate prices' fluctuation to the harmonious development of a national economy. In 2003, when Lithuania became one of the most rapidly developing economies, began an unprecedented growth of housing prices. Encouragements of experts to resist euphoria came short of living standards' growth and the psychological impulse that followed the tendency of price growth. Hence it became possible to state that the real estate price bubble was taking shape and might threaten the national economy. The perception of external signs, with reference to assumptions of economic growth and the interpretation of different factors' interface, enabled to display the influence of the real estate market on the economy and welfare of the country. The estimation of economics growth, which in this article is based on fundamental factors and psychological motives, has displayed the complicated and often difficult to forecast influence of real estate market development on vital processes in economics. By generating insights and future prospects, a possible scenario of factors' development is given in association with presumptive dates of the national currency replacement with Euro. This event is one of the most important economic factors that have laid foundations for causeless psychological motives in the real estate market. When in 2006 Lithuania didn't accomplish the requirements of convergence and therefore couldn't replace its currency with the common currency of European Union, Euro, the growth of real estate prices got slower and influenced the psychological motives of potential customers in the context of the new currency. It is very likely that years 2010–2012 (the presumptive time when the national currency might be replaced with Euro) will enable the participants of the market to come to more rational decisions with reference to the recent past; however, it might be impossible to avoid short-term fluctuations that might be not so threatful. However, when the foundations are rocked, some part of shivers will be absorbed by the insurance sector which will level the negative consequences for people, business and the country, as well as prevent from destroying the productive results of the rapid development.
The problem of real estate price bubble is analysed in relation to the development and growth of the economy of Lithuania. By evaluating theoretical and practical-historical aspects of formation of the housing prices' bubble, as well as the opinion of renown experts of the country, the formation of the present situation is substantiated by specifying economic and psychological reasons (it is accentuated that these factors tendentiously influence the market of real estate in Lithuania). More than once the historical guidelines of many countries had disclosed the threat of real estate prices' fluctuation to the harmonious development of a national economy. In 2003, when Lithuania became one of the most rapidly developing economies, began an unprecedented growth of housing prices. Encouragements of experts to resist euphoria came short of living standards' growth and the psychological impulse that followed the tendency of price growth. Hence it became possible to state that the real estate price bubble was taking shape and might threaten the national economy. The perception of external signs, with reference to assumptions of economic growth and the interpretation of different factors' interface, enabled to display the influence of the real estate market on the economy and welfare of the country. The estimation of economics growth, which in this article is based on fundamental factors and psychological motives, has displayed the complicated and often difficult to forecast influence of real estate market development on vital processes in economics. By generating insights and future prospects, a possible scenario of factors' development is given in association with presumptive dates of the national currency replacement with Euro. This event is one of the most important economic factors that have laid foundations for causeless psychological motives in the real estate market. When in 2006 Lithuania didn't accomplish the requirements of convergence and therefore couldn't replace its currency with the common currency of European Union, Euro, the growth of real estate prices got slower and influenced the psychological motives of potential customers in the context of the new currency. It is very likely that years 2010–2012 (the presumptive time when the national currency might be replaced with Euro) will enable the participants of the market to come to more rational decisions with reference to the recent past; however, it might be impossible to avoid short-term fluctuations that might be not so threatful. However, when the foundations are rocked, some part of shivers will be absorbed by the insurance sector which will level the negative consequences for people, business and the country, as well as prevent from destroying the productive results of the rapid development.
The problem of real estate price bubble is analysed in relation to the development and growth of the economy of Lithuania. By evaluating theoretical and practical-historical aspects of formation of the housing prices' bubble, as well as the opinion of renown experts of the country, the formation of the present situation is substantiated by specifying economic and psychological reasons (it is accentuated that these factors tendentiously influence the market of real estate in Lithuania). More than once the historical guidelines of many countries had disclosed the threat of real estate prices' fluctuation to the harmonious development of a national economy. In 2003, when Lithuania became one of the most rapidly developing economies, began an unprecedented growth of housing prices. Encouragements of experts to resist euphoria came short of living standards' growth and the psychological impulse that followed the tendency of price growth. Hence it became possible to state that the real estate price bubble was taking shape and might threaten the national economy.The perception of external signs, with reference to assumptions of economic growth and the interpretation of different factors' interface, enabled to display the influence of the real estate market on the economy and welfare of the country. The estimation of economics growth, which in this article is based on fundamental factors and psychological motives, has displayed the complicated and often difficult to forecast influence of real estate market development on vital processes in economics. By generating insights and future prospects, a possible scenario of factors' development is given in association with presumptive dates of the national currency replacement with Euro. This event is one of the most important economic factors that have laid foundations for causeless psychological motives in the real estate market.When in 2006 Lithuania didn't accomplish the requirements of convergence and therefore couldn't replace its currency with the common currency of European Union, Euro, the growth of real estate prices got slower and influenced the psychological motives of potential customers in the context of the new currency. It is very likely that years 2010-2012 (the presumptive time when the national currency might be replaced with Euro) will enable the participants of the market to come to more rational decisions with reference to the recent past; however, it might be impossible to avoid short-term fluctuations that might be not so threatful. However, when the foundations are rocked, some part of shivers will be absorbed by the insurance sector which will level the negative consequences for people, business and the country. as well as prevent from destroying the productive results of the rapid development. ; Straipsnyje nagrinėjama šalies ūkio plėtrai ir ekonomikos raidai aktuali nekilnojamojo turto kainų burbulo problema. Įvertinant teorinius ir praktinius istorinius nekilnojamojo turto kainų burbulo formavimosi aspektus, atsižvelgiant į daugelio šalies autoritetingų ekspertų nuomonę, grindžiama susidariusi situacija detalizuojant ekonomines ir psichologines priežastis (pažymima, kad būtent šie veiksniai turi tendencingą poveikį nekilnojamojo turto rinkai Lietuvoje).Išorės signalų poveikio suvokimas remiantis ekonomikos augimo prielaidomis ir skirtingų veiksnių sąveikos interpretavimu leido kryptingai atskleisti nekilnojamojo turto rinkos raidos poveikį šalies ūkiui ir gerovei. Formuojant įžvalgas ir ateities perspektyvas pateikiamas tikėtinas būsimų veiksmų scenarijus, kuris siejamas su skirtinga skelbiama nacionalinės valiutos pakeitimo euru data.
The problem of real estate price bubble is analysed in relation to the development and growth of the economy of Lithuania. By evaluating theoretical and practical-historical aspects of formation of the housing prices' bubble, as well as the opinion of renown experts of the country, the formation of the present situation is substantiated by specifying economic and psychological reasons (it is accentuated that these factors tendentiously influence the market of real estate in Lithuania). More than once the historical guidelines of many countries had disclosed the threat of real estate prices' fluctuation to the harmonious development of a national economy. In 2003, when Lithuania became one of the most rapidly developing economies, began an unprecedented growth of housing prices. Encouragements of experts to resist euphoria came short of living standards' growth and the psychological impulse that followed the tendency of price growth. Hence it became possible to state that the real estate price bubble was taking shape and might threaten the national economy. The perception of external signs, with reference to assumptions of economic growth and the interpretation of different factors' interface, enabled to display the influence of the real estate market on the economy and welfare of the country. The estimation of economics growth, which in this article is based on fundamental factors and psychological motives, has displayed the complicated and often difficult to forecast influence of real estate market development on vital processes in economics. By generating insights and future prospects, a possible scenario of factors' development is given in association with presumptive dates of the national currency replacement with Euro. This event is one of the most important economic factors that have laid foundations for causeless psychological motives in the real estate market. When in 2006 Lithuania didn't accomplish the requirements of convergence and therefore couldn't replace its currency with the common currency of European Union, Euro, the growth of real estate prices got slower and influenced the psychological motives of potential customers in the context of the new currency. It is very likely that years 2010–2012 (the presumptive time when the national currency might be replaced with Euro) will enable the participants of the market to come to more rational decisions with reference to the recent past; however, it might be impossible to avoid short-term fluctuations that might be not so threatful. However, when the foundations are rocked, some part of shivers will be absorbed by the insurance sector which will level the negative consequences for people, business and the country, as well as prevent from destroying the productive results of the rapid development.
The problem of real estate price bubble is analysed in relation to the development and growth of the economy of Lithuania. By evaluating theoretical and practical-historical aspects of formation of the housing prices' bubble, as well as the opinion of renown experts of the country, the formation of the present situation is substantiated by specifying economic and psychological reasons (it is accentuated that these factors tendentiously influence the market of real estate in Lithuania). More than once the historical guidelines of many countries had disclosed the threat of real estate prices' fluctuation to the harmonious development of a national economy. In 2003, when Lithuania became one of the most rapidly developing economies, began an unprecedented growth of housing prices. Encouragements of experts to resist euphoria came short of living standards' growth and the psychological impulse that followed the tendency of price growth. Hence it became possible to state that the real estate price bubble was taking shape and might threaten the national economy. The perception of external signs, with reference to assumptions of economic growth and the interpretation of different factors' interface, enabled to display the influence of the real estate market on the economy and welfare of the country. The estimation of economics growth, which in this article is based on fundamental factors and psychological motives, has displayed the complicated and often difficult to forecast influence of real estate market development on vital processes in economics. By generating insights and future prospects, a possible scenario of factors' development is given in association with presumptive dates of the national currency replacement with Euro. This event is one of the most important economic factors that have laid foundations for causeless psychological motives in the real estate market. When in 2006 Lithuania didn't accomplish the requirements of convergence and therefore couldn't replace its currency with the common currency of European Union, Euro, the growth of real estate prices got slower and influenced the psychological motives of potential customers in the context of the new currency. It is very likely that years 2010–2012 (the presumptive time when the national currency might be replaced with Euro) will enable the participants of the market to come to more rational decisions with reference to the recent past; however, it might be impossible to avoid short-term fluctuations that might be not so threatful. However, when the foundations are rocked, some part of shivers will be absorbed by the insurance sector which will level the negative consequences for people, business and the country, as well as prevent from destroying the productive results of the rapid development.
This section examines the differentiated effects of the COVID-19 pandemic on growth across the euro area. Persistent sharp cross-country divergences complicate the functioning of the economic and monetary union (EMU), and may weaken the socio-economic and political support for EMU. Based on a reduced-form econometric analysis of macro-data and an empirical analysis of turnover patterns and prospects for recovery, the section identifies the economy's sectoral composition and the strictness of the lockdown measures as important factors driving the divergent impact of the pandemic on economic growth. More specifically, the analysis suggests that countries with a larger share of contact-intensive activities have experienced stronger negative growth, and that a higher level of trade openness generally amplified the negative impact of the lockdown measures. A brief overview of monetary and fiscal conditions suggests that the forceful responses of monetary and fiscal policies have helped to dampen the economic shock generated by the pandemic and the related lockdown measures and in so doing have helped contain the divergence forces triggered by the crisis. The risk exists that cross-country divergence will persist well after the pandemic has subsided and the exceptional policies have ended.
This section examines the differentiated effects of the COVID-19 pandemic on growth across the euro area. Persistent sharp cross-country divergences complicate the functioning of the economic and monetary union (EMU), and may weaken the socio-economic and political support for EMU. Based on a reduced-form econometric analysis of macro-data and an empirical analysis of turnover patterns and prospects for recovery, the section identifies the economy's sectoral composition and the strictness of the lockdown measures as important factors driving the divergent impact of the pandemic on economic growth. More specifically, the analysis suggests that countries with a larger share of contact-intensive activities have experienced stronger negative growth, and that a higher level of trade openness generally amplified the negative impact of the lockdown measures. A brief overview of monetary and fiscal conditions suggests that the forceful responses of monetary and fiscal policies have helped to dampen the economic shock generated by the pandemic and the related lockdown measures and in so doing have helped contain the divergence forces triggered by the crisis. The risk exists that cross-country divergence will persist well after the pandemic has subsided and the exceptional policies have ended.
This section examines the differentiated effects of the COVID-19 pandemic on growth across the euro area. Persistent sharp cross-country divergences complicate the functioning of the economic and monetary union (EMU), and may weaken the socio-economic and political support for EMU. Based on a reduced-form econometric analysis of macro-data and an empirical analysis of turnover patterns and prospects for recovery, the section identifies the economy's sectoral composition and the strictness of the lockdown measures as important factors driving the divergent impact of the pandemic on economic growth. More specifically, the analysis suggests that countries with a larger share of contact-intensive activities have experienced stronger negative growth, and that a higher level of trade openness generally amplified the negative impact of the lockdown measures. A brief overview of monetary and fiscal conditions suggests that the forceful responses of monetary and fiscal policies have helped to dampen the economic shock generated by the pandemic and the related lockdown measures and in so doing have helped contain the divergence forces triggered by the crisis. The risk exists that cross-country divergence will persist well after the pandemic has subsided and the exceptional policies have ended.
This section examines the differentiated effects of the COVID-19 pandemic on growth across the euro area. Persistent sharp cross-country divergences complicate the functioning of the economic and monetary union (EMU), and may weaken the socio-economic and political support for EMU. Based on a reduced-form econometric analysis of macro-data and an empirical analysis of turnover patterns and prospects for recovery, the section identifies the economy's sectoral composition and the strictness of the lockdown measures as important factors driving the divergent impact of the pandemic on economic growth. More specifically, the analysis suggests that countries with a larger share of contact-intensive activities have experienced stronger negative growth, and that a higher level of trade openness generally amplified the negative impact of the lockdown measures. A brief overview of monetary and fiscal conditions suggests that the forceful responses of monetary and fiscal policies have helped to dampen the economic shock generated by the pandemic and the related lockdown measures and in so doing have helped contain the divergence forces triggered by the crisis. The risk exists that cross-country divergence will persist well after the pandemic has subsided and the exceptional policies have ended.
In this paper we take the integrated accounts perspective to analyse the case of the recent economic and financial cycle in Lithuania. This cycle was marked by the sectoral balance sheet expansion during the boom years followed by a balance sheet recession associated with economically very painful credit and monetary contraction. The cyclical developments were strongly associated with exuberant bank lending during the boom years, followed by a sudden reversal of lending conditions and the subsequent repatriation of debt financing by foreign banks. From the integrated accounts perspective, one of the crucial factors stabilising the economy after the crisis was rapid accumulation of public debt, which effectively offset deleveraging of the private sector. The government had to resort mainly to costly foreign financing, though in principle, under certain conditions, domestic financing could have been achieved.
In this paper we take the integrated accounts perspective to analyse the case of the recent economic and financial cycle in Lithuania. This cycle was marked by the sectoral balance sheet expansion during the boom years followed by a balance sheet recession associated with economically very painful credit and monetary contraction. The cyclical developments were strongly associated with exuberant bank lending during the boom years, followed by a sudden reversal of lending conditions and the subsequent repatriation of debt financing by foreign banks. From the integrated accounts perspective, one of the crucial factors stabilising the economy after the crisis was rapid accumulation of public debt, which effectively offset deleveraging of the private sector. The government had to resort mainly to costly foreign financing, though in principle, under certain conditions, domestic financing could have been achieved.
In this paper we take the integrated accounts perspective to analyse the case of the recent economic and financial cycle in Lithuania. This cycle was marked by the sectoral balance sheet expansion during the boom years followed by a balance sheet recession associated with economically very painful credit and monetary contraction. The cyclical developments were strongly associated with exuberant bank lending during the boom years, followed by a sudden reversal of lending conditions and the subsequent repatriation of debt financing by foreign banks. From the integrated accounts perspective, one of the crucial factors stabilising the economy after the crisis was rapid accumulation of public debt, which effectively offset deleveraging of the private sector. The government had to resort mainly to costly foreign financing, though in principle, under certain conditions, domestic financing could have been achieved.
