Prague Economic Papers, 2020 (roč. 29), číslo 4
Single Stimuli, Multiple Responses: Performance Feedback and Firms’ R&D Changes
Michal Jirásek
Prague Economic Papers 2020, 29(4):381-402 | DOI: 10.18267/j.pep.734 
The behavioral theory of the firm assumes that firms react on performance feedback by increasing their search for alternative courses of action. However, the empirical literature is full of contradictory findings. This paper puts forward the idea that at least part of these contradictions can be explained if we can identify groups of firms behaving differently from firms in other groups and theoretical propositions. The paper uses exploratory analysis of US and German industrial firms and changes in R&D expense as their response to financial performance feedback. The cluster analysis of behavioural patterns of these firms results in identifying...
The Influence of FDI on Domestic Innovation: An Investigation Using Structural Breaks
Mingbo Zheng, Gen-Fu Feng, Jun Wen, Chun-Ping Chang
Prague Economic Papers 2020, 29(4):403-423 | DOI: 10.18267/j.pep.739
This paper investigates the influence of foreign direct investment on innovation by em-ploying the panel cointegration method incorporating multiple structural breaks and a dynamic common correlated estimation for 34 countries over the period 1991-2016. Our findings indicate that the series of innovation and foreign direct investment are stationary after considering the potential structural breaks and that the external shock is mainly from country-specific shocks. Our results also suggest that a long-run co-integrated relationship exists with one break between foreign direct investment and innovation. Furthermore, the estimation based on the dynamic...
Assessing the Job-Finding Probability of Older and Prime-Age Unemployed Workers
Vladislav Flek, Martin Hála, Martina Mysíková
Prague Economic Papers 2020, 29(4):424-444 | DOI: 10.18267/j.pep.738
We analyse the extent and determinants of somewhat gloomy employment prospects of older unemployed populations in Austria, the Czech Republic, Poland and Slovakia. For this purpose, we explore the European Union Statistics on Income and Living Conditions over the period 2004-2014. Survival estimates suggest that older unemployed workers face lower job-finding probabilities compared to prime-age unemployed workers, while this age-based gap increases with longer unemployment spells. The results of estimating the hazard models reveal that the job-finding probability of older unemployed workers is about 20-25% lower than that of the prime-age group, even...
Application of Copulas to Modelling of Marriage Reverse Annuity Contract
Joanna Dębicka, Stanisław Heilpern, Agnieszka Marciniuk
Prague Economic Papers 2020, 29(4):445-468 | DOI: 10.18267/j.pep.745
We model the probabilistic structure and cash flows arising from marriage reverse annuity contracts in the case of the joint-life status and the last surviving status. In contrast to the classical approach, we take into consideration that future lifetimes between spouses are dependent. The structure of dependence of the length of spouses' lives is modelled using copulas. The term structure of interest rate is modelled using a time-dependent function. The numerical results are based on actual Polish data covering both the structure of the probabilistic model and the interest rate.
An Explorative Paper on Speculative Approaches to Smart Contracts
Sanel Halilbegovic, Necip Ertem
Prague Economic Papers 2020, 29(4):469-480 | DOI: 10.18267/j.pep.742
The trend of cryptocurrencies has stirred interest in the underlying technology that qualifies cryptocurrencies as a secure structure with speedy, timely and cheap transactions. The aforementioned technology, the blockchain, in brief terms is a decentralized ledger technology that attains an immutable characteristic through consensus and timestamp mechanics. The model also sets the stage for transparency in transactions, which renders the technology applicable to a myriad of scenarios that involve financial instruments. This research puts forth an argumentative approach to the applicability of blockchain technology and specifically studies the prospect...
Sustainability of Current Account Surpluses: Evidence from European Countries
Ayşen Sivrikaya, Zühal Kurul
Prague Economic Papers 2020, 29(4):481-501 | DOI: 10.18267/j.pep.733
Over the last two decades, the current accounts in the European Union (EU) have diverged substantially. This divergence has raised concerns about the sustainability of the core countries' current account surpluses since the peripheral countries' financing of their significantly rising levels of current deficits depends on them. In this study, by applying both linear and nonlinear unit root tests and taking into account structural breaks in the data-generating process, we examine the current account sustainability of the main core countries with large external surpluses. We find that the current accounts of Austria, Denmark and Germany are not on sustainable...