The nexus between unemployment and the shadow economy in Lithuanian regions during the COVID-19 pandemic
In: Journal of international studies, Band 14, Heft 3, S. 59-72
ISSN: 2306-3483
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In: Journal of international studies, Band 14, Heft 3, S. 59-72
ISSN: 2306-3483
In: Central European journal of public policy: CEJPP, Band 10, Heft 1, S. 1-11
ISSN: 1802-4866
Abstract
The topic of competitiveness is becoming increasingly significant in the context of modern economics. Considering intensive processes of globalisation alongside with competitive pressure amongst the countries, competitiveness has become a necessary condition for successful economic and social development of any country. Only by creating, enforcing and maintaining international competitiveness of the country, rapid economic growth during the long term is achievable. Amongst the other urgent issues, the European Union (further the EU) public policies are also focused on competitiveness. After the failure to implement the Lisbon strategy and become "the most dynamic and competitive knowledge-based economy", the EU declared its new competitiveness aims in the long-term strategy Europe 2020. Promotion of competitiveness is one of the fundamental aims and priority directions of the EU structural policy. The EU structural support is engaged as one of the public policy measures to promote the competitiveness of the member-states. In this context, it is purposeful to research whether the structural support is used efficiently and whether it actually contributes to the implementation of the defined aims. Under the order of various Lithuanian institutions, numerous studies on the efficiency of the EU structural support have been carried out. Nevertheless, by analysing the impact of the EU structural support, insufficient attention has been paid to the aspect of competitiveness. Considering the fact that Lithuania has entered the third programming period 2014-2020, evaluation of the EU structural investment in the country has become even more topical - for successful implementation of the aims raised for this new period, the analysis of the previous results is relevant. This determined formulation of the research problem: what impact does the EU structural support have on the competitiveness of Lithuanian economics? The empirical research has revealed that the EU structural support has a positive impact on Lithuanian gross domestic product growth, promotes foreign direct investment, research and development expenditure and increases the number of operating entities during 2004-2014 period.
Lithuania has made a significant progress on institution-building and policymaking in support of entrepreneurship over the last ten years (Grundey et al., 2008); however, the constantly changing business environment, information-flow growth, processes of integration into the global market increase business risk, and this complicates the people's determination to start their own business (Remeikiene, Startiene, 2007; Voronova, 2008), because business itself cannot provide the projected free cash flow (Kazlauskiene, Christauskas, 2007); a business establishment is limited by the lack of financial support measures for the start ups and developments of small and medium-sized businesses (Tamosiūnas, Lukosius, 2009); in order to survive in the market, firms are not only forced to recognize business risks, but must learn to manage them (Savcuk, 2007). A person determined to become an entrepreneur must evaluate not only the external, but also personal circumstances.The article deals with an actual problem – the influence of demographical factors on the interaction between entrepreneurship and unemployment. The interaction between the entrepreneurship and unemployment is mainly analyzed through the two-way relationship between entrepreneurship and unemployment. The authors of studies (Thurik, 2003; Thurik, Verheul, 2002; Stel, Stunnberg, 2004; Audretsch, Carey, Thurik, 2002; Care, Stella, Thurik, Audretsch, 2007) found that this relationship exists in the countries such as Japan, OECD countries. While studying the interaction between entrepreneurship and unemployment in other countries (Portugal, Spain, United Kingdom), the conclusion was made that economic analysis is insufficient in order to determine the bonds between them, it is necessary to analyze and evaluate all the chain of factors (cultural, demographic, political, psychological, technological)which determine the mutual relations between entrepreneurship and unemploymentBy the purpose of the article – the evaluation of the influence of demographical factors on ...
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The methods employed for the research include comparative and systematic literature analysis, statistical data analysis, expert evaluation and the Multiple Indicators Multiple Causes (MIMIC) model. There are several research gaps in the field of e-business: 1) there is no simplified factor model which would denote the development of e-business, including its causes and consequences, and which, due to its universality, could be adapted to any country; 2) the studies of e-business development lack a comprehensive assessment which would consider this phenomenon in both quantitative and qualitative terms.On the basis of the theoretical analysis, a model for assessment of e-business development has been formed. The results of the empirical evaluation have revealed that in the group of micro environmental determinants development of e-business in Lithuania is, to the largest extent, determined by business managers' motivation to reach the defined aims and their positive viewpoint that e-business may become a perfect auxiliary tool to ensure business competitiveness. In the group of macro environmental determinants, the determinants of socio-cultural environment can be indicated as the major ones that affect the development of e-business. Application of the MIMIC model has enabled to identify the following macro economical determinants (for the euro area): real effective exchange rate for the euro area; level of households with the Internet access; quantity of individuals using the Internet for ordering goods or services; government deficit/surplus; youth employment, and individuals using the Internet for interaction with public authorities.
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Although international trade is an incontestable driver of economic development, scientific literature still lacks the studies to assess the impact of the international trade in agricultural products on the EU economic growth. The agricultural sector is treated as specific in comparison to other economic sectors as the EU subsidisation policies causes distorted competition in both local and global agricultural markets. The main purpose of this article is to assess the impact of the international trade in agricultural products on the economic growth of EU28. The results of the correlation and regression analyses have revealed that the international trade in agricultural products (in particular, section I and III products) contributes only insignificant part, to the economic growth of EU28 through the following indicators: GDP in market prices, self-employment, employment in the agricultural sector, labour force rate, subsidies and other transfers. The results have also disclosed that while analysing the impact of the international trade in agricultural products on economic growth, there is no necessity to research export and import volumes in separate as agricultural export and import show nearly the same (only with insignificant value differences) determinants of economic growth promotion. Another important conclusion is that the international trade in agricultural products mainly comprises the trade in live animals and animal products (meat and edible meat offal, fish and crustaceans, molluscs and other aquatic invertebrates, dairy produce, birds' eggs, natural honey, edible products of animal origin, not elsewhere specified or included, and products of animal origin, not elsewhere specified or included) as well as animal or vegetable fats and oils and their cleavage products, prepared edible fats, and animal or vegetable waxes.
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The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products.The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
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The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products.The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
BASE
The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products. The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
BASE
The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products. The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
BASE
The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products. The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
BASE
The purpose of the article is to carry out the assessment of the industrial competitiveness of the Baltic States in the EU during the period of economic recession. Revealed comparative advantage (RCA) and Symmetric index (SI) index values revealed that after the period of economic recession, the growth of the industrial competitiveness of the Baltic States, considering it from export positions, is slower in comparison with GDP changes. Latvia has taken strong competitive positions in the industry of raw materials; Estonia also has medium comparative advantage in the industry of raw materials, while Lithuania has the comparative advantage in the industries of mineral fuels, lubricants and related materials. Export competitiveness index (XCI) results showed that all three Baltic States had growing competitive advantage in the industries of food, drinks and tobacco during both the period of economic recession and the period of economic revival. In the period of economic revival Estonia showed the growth potential in the industries of chemicals and related products, while Lithuania – in the industry of raw materials and related products. The identification of competitive industries during the periods of economic recession and revival can provide the governments of the Baltic States with the target data not only for supporting export companies, but also for taking the best decisions to improve the business environment in the industries that have the competitive advantage.
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In: Journal of international studies, Band 14, Heft 4, S. 9-22
ISSN: 2306-3483
International direct and portfolio investments have gone up considerably as of mid-1980s. The foreign direct investments with characteristic of long term horizon may affect the economic variables through know-how and technology transfer, physical capital expansion, and new job creation. However, foreign direct investments may have potential to negatively affect the domestic competitors with insufficient competitiveness in the industry. So, the economic effects of FDI inflows have been one of the much-debated and studied issues in the international economics. This study investigates the unemployment effects of greenfield and brownfield investments in 11 post-transition EU members over 2003-2017 period through panel cointegration and causality tests. The article fills the gap in the literature, because the relevant empirical literature has generally researched the impact of total FDI flows on the unemployment/employment. The empirical findings revealed that brownfield investments raised the unemployment in overall panel in the long run, but greenfield investments had no significant impacts on the unemployment in overall panel in the long run. However, greenfield investments decreased the unemployment in Croatia, Hungary, and Slovenia, and raised the unemployment in Poland and Slovakia, while brownfield investments raised the unemployment only in Czechia. Consequently, it is not very reasonable to compare our findings with the results of other studies using total FDI inflows as the independent variable. But, it is generally consistent with theoretical and empirical expectations.
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The aim is to estimate the level of shadow economy in the regions of Lithuania during the year of 2012-2016 after having identified causal factors in this article. The topic is very relevant to such countries of transition economy like Lithuania, where huge separation exists between regions and big cities. Deeper social problems in regions, lack of job places, absence of investments and emigration to bigger cities of a country or abroad create conditions for the growth of criminal offenses and shadow economy. Performed calculations under MIMIC model have shown that the share of indirect taxes, average income, the cases of cigarette smuggling, population of women per 1000 men, the number of criminal offence, children in social risk families and the number of tourists are the main causes for the emergence and growth/decline of shadow economy level. The novelty of the article is that the calculations reveal a significantly higher level of shadow economy in the regions, than at the country level, therefore it is recommended to make calculations at the regional level in order to select measures to more effectively fight with the "shadow". Identified reasons allow formulating the following recommendations for responsible authorities: increase efficiency in tax system, since current excise tax policy has a positive impact on the level of poverty, especially at regional level, deepening of social problems, which as a result contribute to the growth of shadow economy; encourage women' occupancy, emancipation and attract funding from national and international projects, to promote equal rights in researched regions; increase the level of attractiveness and security level in cities, promote FDI to cities, and effectively use money from EU Structural Funds.DOI: http://dx.doi.org/10.5755/j01.ee.29.4.19438
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