Prague Economic Papers, 2025 (vol. 34), issue 1

How Important is the Structure of the EU Economy to the VAT Collection?

Hana Zídková, Spyros Papadakis, Markéta Arltová, Ioannis Lomis, Anna Christou

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...

Does Public Debt Crowd Out Public Investment in Central and Eastern European economies? A Dynamic Approach Using CS-ARDL

Milena Konatar, Jovan Đurašković, Nemanja Popović, Milivoje Radović

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...

The Impact of Infrastructure Development on the Economic Growth of the Countries in the Western Balkans and their EU Future

Danijela Jaćimović, Milena Lipovina-Božović, Bojan Pejović, Sunčica Vuković

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...

Housing Affordability in Germany and its Dynamics

Felix Florian Balz

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.

A Multidimensional Financial Inclusion Index for Ethiopia

Mohammed Jatoro Arebo, Filmon Hadaro Hando, Andualem Goshu Mekonnen

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...