Prague Economic Papers 2025, 34(2):165-186 | DOI: 10.18267/j.pep.888
This paper examines exchange rate pass-through (ERPT) to prices in Central and Eastern European (CEE) countries, focusing on the Czech Republic, Poland, Hungary, and Romania. We employ a Structural Vector Autoregression (SVAR) model to analyse the transmission of exchange rate shocks to imported, producer, and consumer prices. Results indicate significant heterogeneity in ERPT across countries and price stages. While all countries exhibit higher pass-through for import prices, variations emerge in producer and consumer price responses. Monetary policy credibility and trade openness are found to influence ERPT dynamics. The findings highlight the importance...
Prague Economic Papers 2025, 34(2):137-164 | DOI: 10.18267/j.pep.889
This study constructs two eight-asset green-energy portfolios, featuring stocks from the U.S. and Europe, to assess which portfolio delivers superior risk-adjusted performance. The analysis utilizes advanced performance metrics, the Stutzer and Omega ratios, with the traditional Sharpe ratio serving as a benchmark. Portfolios are evaluated across both pre-crisis and crisis periods. The results reveal differences in the structures of the Sharpe and Stutzer portfolios, underscoring the Stutzer ratio's ability to improve portfolio performance. Additionally, the Omega portfolio enhances the analysis by allowing the selection of varying thresholds, offering...
Prague Economic Papers 2025, 34(2):250-277 | DOI: 10.18267/j.pep.890
Reducing income inequality is one of the goals under the Sustainable Development Goals. This study examines the intricate relationship between financial development, policy uncertainty, inflation, and income inequality. Panel data for African countries covering the period 2000-2022 were used in the analysis. The study used the economic policy uncertainty (EPU) index to examine its effects on income distribution. Previous studies indicated the possibility of asymmetric effects of inflation and EPU on income inequality. Hence, a dynamic non-linear Panel ARDL was employed to examine the asymmetric nature of the relationship between these variables. The...
Prague Economic Papers 2025, 34(2):214-249 | DOI: 10.18267/j.pep.891
Numerous studies have explored the possible causes of global carbon emissions and climate change; however, the impact of export diversification and concentration on these emissions is a less examined topic in literature. This study investigates the effects of export diversification and concentration on carbon emissions in Türkiye from 1995 to 2018, utilizing the nonlinear ARDL method. The findings indicate that export diversification reduces carbon emissions after accounting for the effects of other control variables, such as renewable energy, levels of inequality, and government size. In this model, an increase in renewable energy, inequality, and...
Prague Economic Papers 2025, 34(2):187-213 | DOI: 10.18267/j.pep.892
This paper deals with the taxation of still wine in the Czech Republic. The aim of the paper is to quantify the fiscal impact of the imposition of a non-zero excise duty rate on still wine on excise and value added tax revenue. The paper uses an analytical approach to assess the impacts using data collected on consumption, production and price of wine and elasticity of demand under several alternative tax rates. The results show that taxation of still wine has significant potential to increase tax revenues for public budgets. Tax revenues would increase by an amount between 4.7 and 5.3 billion CZK if the tax rates on still and sparkling wine were aligned....
Prague Economic Papers 2025, 34(1):98-136 | DOI: 10.18267/j.pep.886
This study develops a multi-dimensional composite index to measure financial inclusion in Ethiopia, using a two-stage Principal Component Analysis based on ten traditional and five digital indicators from 2015 to 2023. The results reveal a significant increase in Ethiopia’s financial inclusion score, rising from an average of 10.89% in 2015 to 52.18% in 2023. Among the dimensions, traditional availability (0.2625) is the most influential, followed by traditional usage (0.2616), digital accessibility (0.2505), and digital availability (0.2254). Further analysis reveals that the Commercial Bank of Ethiopia alone contributes 48.99% for financial...
Prague Economic Papers 2025, 34(1):78-97 | DOI: 10.18267/j.pep.885
The study examines housing affordability in Germany from 2017 to 2023 in light of rising real estate prices and challenges in the housing market. It uses the Housing Affordability Index to identify trends and patterns and propose policy measures to tackle the problems. The results show regional differences, with large cities in particular facing rising prices. Overall, the housing affordability burden has worsened across the country, with the western federal states being particularly affected. Future research should focus on evaluating policy measures and analyzing future trends in order to develop appropriate strategies and make predictions for the future.
Prague Economic Papers 2025, 34(1):45-77 | DOI: 10.18267/j.pep.884
The infrastructure investment could strongly influence the economic growth in the Western Balkans countries and contribute to improved regional cooperation and reconciliation and to faster integration into the EU. However, it is essential that public investments in infrastructure are properly financed and managed. To measure the impact of infrastructure indicators on economic growth, panel regression analysis was used for the period 2000-2021, in six Western Balkan countries. The paper addresses the important question of how to intensify investments in infrastructure to achieve sustainable growth in the Western Balkans. The obtained results confirm...
Prague Economic Papers 2025, 34(1):26-44 | DOI: 10.18267/j.pep.887
This study estimates the impact of public debt on public investment in Central and Eastern European (CEE) economies. We implement Cross-sectionally Augmented Autoregressive Distributed Lag (CS-ARDL) model, which effectively handles cross-sectional dependence and slope heterogeneity, while dealing with short- and long-run coefficients simultaneously. The results indicate the existence of both short- and long-term crowding out effects of public debt on public investment in the CEE region. These findings have significant fiscal policy repercussions, particularly in context marked by constrained financial resources and substantial debt loads, as has been...
Prague Economic Papers 2025, 34(1):1-25 | DOI: 10.18267/j.pep.880
VAT is one of the most important sources of the public revenues in the EU Member States; therefore, it is crucial to determine the factors of VAT collection. So far, only a few researchers analyzed the influence of individual economic sectors on the indicators of VAT collection, namely Compliance and Policy gaps. Therefore, the authors used the autoregressive distributed lag (ARDL) and Error Correction (EC) models to study the relationship between eleven economic sectors, the VAT Compliance Gap and the VAT Policy Gap, which were selected as the dependent variables. The research focused on twenty-five EU member states, and the examined time period was...
Prague Economic Papers 2024, 33(6):764-800 | DOI: 10.18267/j.pep.882
IPO listing review via comment letters is an important mechanism to improve the quality of listed firms, while its impact on corporate post-listing behaviors is not clear. Using China's Sci-Tech Innovation Board (STAR market) listed firms, this paper examines the impact of IPO listing review on corporate post-listing tax avoidance behavior. The empirical tests show that the increase of listing review intensity is significantly associated with lower corporate tax avoidance activities of firms after listing. Using textual analysis methods and mediating analysis, this study finds that the decrease effect of listing review on corporate tax avoidance activities...
Prague Economic Papers 2024, 33(6):731-763 | DOI: 10.18267/j.pep.881
With Saudi Arabia's tendency to implement a policy of economic openness to the world from the early 1980s, the phenomenon of conspicuous consumption (society of consumption and imitation) has increased. Due to the adoption of the concepts of economic globalization, changing consumption patterns, tourism and travelling and the spread of multi-national companies which market and promote their products over different mass media, this phenomenon has remarkably gone up. Over time, the effects of this phenomenon have spread to low-income groups, especially young people, and it has been a motive for some young people to earn money illegally to afford it....
Prague Economic Papers 2024, 33(6):709-730 | DOI: 10.18267/j.pep.878
In the study, quantile regression (QR) is employed as the primary research tool, with ordinary least squares (OLS) regression used for comparison purposes. The motivation for this research stems from conflicting findings in existing literature regarding the spillover effects of Brent crude oil prices for the pharmaceutical industry. Findings from the QR analysis indicate that more substantial spillover effects occur in the tail quantiles, specifically during periods of economic crisis and prosperity. Recommendations for future research should focus on gaining a deeper understanding of the mechanisms underlying the differential responses of oil and...
Prague Economic Papers 2024, 33(6):691-708 | DOI: 10.18267/j.pep.883
The study examines the deferred tax in the valuation and acquisition of real estate companies, the behavior of the buyers and sellers in real estate transactions and the impact on the purchase price. We analyze the data from the Czech Republic commercial real estate market in the period of 2018-2019 where taxation provisions for Asset and Share Deal transactions induce a special type of a deferred tax - a latent capital gains tax (LCGT). Based on the data of 25 Share Deal real estate transactions we bring evidence that the LCGT was reflected in the purchase price by 0-50%, median value being 0%. We document that this market-imported percentage can...
Prague Economic Papers 2024, 33(6):662-690 | DOI: 10.18267/j.pep.879
Although it is notoriously difficult to utilize financial ratios to forecast the crude oil market prices, our study challenges this perception and reveals that the second risk premium principal component analysis (RP-PCA) factor may contain statistically significant information for both in-sample and out-of-sample forecasts of future crude oil prices. Our evidence illustrates that the second RP-PCA factor substantially outperforms many other popular predictors (approximately 30 conventional predictors) in forecasting crude oil prices and generating adequate higher values of economic profits. We conduct a range of informative tests, including bootstrap...
Prague Economic Papers 2024, 33(5):645-661
This study investigates the impact of terrorism on financial markets, focusing specifically on Turkey's sovereign Credit Default Swap (CDS) premiums from 2011 to 2017 - period characterized by frequent and diverse terrorist activities. Employing an EGARCH model with dummy variables for various terrorist groups, we analyze immediate and short-term market reactions across different event windows. Our findings reveal significant volatility in CDS premiums following terrorist incidents, with market responses varying depending on the terrorist group perpetrating the incident. This study enhances the understanding of capital market reactions on terrorist...
Prague Economic Papers 2024, 33(5):617-644
This paper aims to assess the relationship between income and consumption expenditures of households in Romania between 1997 and 2022. The chosen econometric methods are the Augmented Dickey-Fuller and Phillip-Perron unit root tests, Granger causality tests and the Johansen-Juselius test. Our study highlights the fact that together with the increase in the monetary income, there was a considerable reduction in the income in kind that ensured the coverage of the consumption needs at the household level. Additionally, the increase in the population's monetary income is essential for reducing the share of expenses on the consumption of food products and...
Prague Economic Papers 2024, 33(5):599-616
This study examines the role of age in the selection and promotion of employees within public and private organizations, with a particular focus on Czech organizations. The research investigates the impact of age on career advancement across various industries and regions, aiming to provide insights into potential age-related biases in the workplace. The study utilizes a mixed-methods approach, combining quantitative analysis of promotion rates with qualitative insights from organizational representatives. Despite the intriguing nature of the topic, the study faces several challenges, including a relatively low number of respondents and limited data...
Prague Economic Papers 2024, 33(5):565-598
We estimate that the Unobserved Economy (UnEc) share in Portuguese GDP rose to a maximum of 34.37% in 2022. The results suggest that cutting the tax burden and improving the efficacity of social benefits could reduce UnEc and foster inclusive growth. The rising UnEc share MIMIC estimates found in our single-country study, with variables suited to Portugal, contrast with the downward trend (from 22.2% in 2003 to 16.5% in 2021) in the MIMIC multi-country study by Schneider (2021), who uses different variables - mostly reflecting the economic structure of advanced economies - and does not report if and how country heterogeneity is dealt with. Compared...
Prague Economic Papers 2024, 33(5):543-564
Green finance aims to achieve a balance between economic performance and sustainable economic development. This study examines the effect of green finance on sustainable eco- nomic development at the national level by spotlighting countries that are at the forefront of green bond issuance. Employing balanced panel data and utilizing a mediation model with fixed effects, the results demonstrate a significant ability of green finance to mitigate carbon emissions and promote high-quality economic development. The robustness of the findings is confirmed by a series of statistical tests. Furthermore, the renewable energy consumption structure enhances the...
Prague Economic Papers 2024, 33(4):504-542 | DOI: 10.18267/j.pep.871
Expanding imports and promoting balanced trade have been the direction China has been adhering to in recent years, and are also important measures for China to build an open domestic and international dual cycle development pattern. This paper incorporates the emissions of “three industrial wastes” into the production function, uses the Slack Based Measure model and the globally referenced Malmquist-Leuenberger index to measure the green total factor productivity of Chinese enterprises from 2002 to 2013 in order to measure enterprises’ green transformation development. Subsequently, it tests the green development effect of import...
Prague Economic Papers 2024, 33(4):478-503 | DOI: 10.18267/j.pep.865
This paper investigates the nonlinear risk transmission from the oil and natural gas markets to the foreign exchange markets of five energy importers and one major energy exporter. We separate conditional volatility into the transitory (short-term) and permanent (long-term) parts, and then these volatilities are embedded in an elaborate robust linear quantile regression model. We find that the risk spillover effect is relatively low in Central and Eastern European countries (CEECs) probably because they pursue a managed float exchange rate regime. On the other hand, this effect is higher for Turkey and Russia, which is especially true for the effect...
Prague Economic Papers 2024, 33(4):444-477 | DOI: 10.18267/j.pep.864
Poverty reduction has long been one of the political priorities of the European Union and its member states. Despite the political declarations and measures applied, poverty is still a phenomenon that affects the everyday lives of about 70 million Europeans. Moreover, trends in poverty incidence show how poverty risks are sensitive to overall socio-economic development and how they are more actual for some vulnerable population groups. Following the popular concept of poverty feminization, the analysis presented in the paper aims to identify gender perspective relationship between the poverty incidence and characteristics describing the situation on...
Prague Economic Papers 2024, 33(4):414-443 | DOI: 10.18267/j.pep.870
This paper examines the effect of company size on transaction multiples. The existence of the size effect has been investigated by a number of authors who have primarily used data for publicly traded companies for their research. Our research works with data from private transactions with non-traded companies (shares) from the EU. The transaction price concluded in these deals is decomposed into the product of profit and transaction multiple as when using market comparison valuation methods. Transaction multiples are relative types of financial metrics that typically compare various levels of profit such as EBITDA, EBIT or EAT to a value that an investor...
Prague Economic Papers 2024, 33(4):380-413 | DOI: 10.18267/j.pep.872
In the last two decades, advances in globalization have evolved remarkably and countries have become more integrated with the entire world. The implications of this process have attracted interest of researchers and monetary policy authorities. This paper provides an assessment of the impact of globalization on macroeconomic dynamics at the level of four representative Central Eastern European countries (Czechia, Hungary, Poland and Romania) between 2003Q2 and 2022Q4. The method proposed in this study is a time-varying vector autoregressive model with stochastic volatility estimated using the Metropolis-Hastings algorithm through Bayesian inference....
Prague Economic Papers 2024, 33(3):277-318 | DOI: 10.18267/j.pep.862
This paper deals with the problem of how the risk perception among retail customers is affected by the consumer protection regulation on the financial market. Through a questionnaire survey, we have measured the effect of selected consumer protection measures on banking or investment decisions taken by a young (student) population. These measures included the most common elements of financial regulation, such as bank deposit insurance, corporate bond prospectus, licenced fund management and securities broker indemnity insurance. Our results show that protective state intervention represents strong stimuli for customer decision-making with a widely...
Prague Economic Papers 2024, 33(3):319-335 | DOI: 10.18267/j.pep.861
Non-fungible tokens are transferable rights to digital assets such as artwork, videos, in-game items, collectibles or music. Non-fungible tokens relate only to a specific unique item and carry information about the owner. The non-fungible token market has received widespread attention and has grown enormously since the beginning of 2021. Despite significant growth in the market, there needs to be more surveys, especially in the context of the Czech Republic. This article, therefore, aims to evaluate the level of awareness of non-fungible tokens in the Czech Republic. The paper presents the basics of the non-fungible token market, its potential and...
Prague Economic Papers 2024, 33(3):357-379 | DOI: 10.18267/j.pep.858
This study investigates the macroeconomic resilience of the Moroccan economy using a comprehensive analysis of key indicators and policy variables. Utilising data from sources such as the World Bank, we examined GDP per capita, government debt, government final expenditure, agriculture and industry sectors as a percentage of GDP, output gap, and trade openness. Applying the Autoregressive Distributed Lag (ARDL) method, we established both long-run and short-run relationships between these variables and the output gap, which represents the cyclical trend in the economy. Our findings revealed that both government final consumption in % of GDP and government...
Prague Economic Papers 2024, 33(3):336-356 | DOI: 10.18267/j.pep.860
The main objective of this study is to determine the effects of economic and social inequalities on academic success and to test whether the cycle of inequality is active through education. This objective is accomplished using classical and Bayesian discrete choice models for the sample obtained from Türkiye. The results reveal that students' economic and social characteristics affect their academic success and that these characteristics are possible sources of inequality in education. According to the findings obtained from models employed in the study, income, private school education, parental education level, region of residence, neediness to work,...
Prague Economic Papers 2024, 33(3):261-276 | DOI: 10.18267/j.pep.863
Modeling policy effects in the context of high-dimensional data requires a balanced consideration of omitted interaction bias and overfitting problems. This paper investigates the role of machine learning algorithms in stabilizing estimates and demonstrates the possible regularization bias caused by common LASSO methods. To overcome the three problems simultaneously, post-double selection is used to screen for the interaction terms that need to be included in the model, and the variance estimates are expanded to measure the uncertainty of the interaction effects and marginal effects. Monte Carlo simulations analyze the main factors affecting conditional...
