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This paper for the first time calculates the historical regional GDP (rGDP) for an Eastern European country by using the methodology of Frank Geary and Tom Stark [2002. Examining Ireland's post-famine economic growth performance. The Economic Journal, 112(482):919–935]. The estimates cover the period 1925–1935 and are made for the historical Latvian regions Kurzeme, Vidzeme, Zemgale, Latgale, and Riga as well as within the contemporary NUTS3 units. The results are compared with the GDP disparity of the NUTS3 regions of the restored independent Latvia (2001–2016). The main findings are that the sigma divergence remained stable. Direct comparisons of regional growth rates indicate that economically more advanced regions were more sensitive to business cycles than less advanced regions. Hence, sigma divergence seems to prevail in times of high growth and convergence in times of low growth. [ABSTRACT FROM AUTHOR]

The paper introduces financial intermediation into the New Keynesian model with rare disasters, analyzes the impacts of rare disaster shock on the macro economy, and compares the effects of different economic recovery policies. Based on the numerical analysis, this study finds that: (1) rare disaster risk shock retains a negative relationship with consumption levels, and banks increase their leverage ratios to cause risk accumulation; (2) refinance policy and consumer coupon policy can alleviate economic fluctuations caused by disaster risks from various channels; (3) the consumer coupon policy is conducive to reducing the average social welfare loss caused by disaster risks. It is believed that the establishment of a sustainable economic stimulus mechanism to fundamentally reduce the impact of catastrophic events on the macro economy and achieve economic recovery in a short period are essential issues that should be urgently addressed by countries. [ABSTRACT FROM AUTHOR]

The primary purpose of this paper is to investigate macroeconomic, financial and welfare effects of financial constraints and policy uncertainty on the economy featuring shifting trend inflation. By developing a New Keynesian model incorporating trend inflation into staggered prices and staggered credit channel, we indicate three important findings. First, we report negligible welfare consequences of financial shocks, whereas policy uncertainty shocks dampen the economic welfare considerably. More importantly, financial frictions are a channel through which policy uncertainty stuns the economy more remarkably. Second, the welfare consequences and business cycles effects of shocks are greater in the high-trend-inflation economy, while the costs of exogenous variations in trend inflation are larger if there is policy uncertainty. Third, among staggered prices and staggered credit, the later plays a more vital role in transmitting adverse effects of shocks to trend inflation into the economy. [ABSTRACT FROM AUTHOR]

Poverty is a global problem, and fighting it is a historical task faced by humanity. The outbreak of poverty crises has a certain cyclicality, and the development of economic research may react to poverty cycles. To validate this view, we take the United States as an empirical example and establish a quantitative research architecture based on the bibliometrics and econometrics. In the first place, we conduct a bibliometric analysis of selected search terms relevant to poverty cycles. After that, the time-series data in the actual economy are collected for reflecting the trends and fluctuations in economic activity affected by poverty cycles. Meanwhile, with both bibliometric and economic data, a detrending measure via the band-pass (BP) filter is performed to estimate cycles. Finally, the Granger causality tests are implemented to explore the interaction between poverty cycles and economic research directly. As a supplement, this paper also provides a quantitative evaluation analysis, namely impulse-response functions, to investigate the influence of economic variables on bibliometric ones. The final results show there indeed exists an impact of poverty cycles in economic activity on relevant discussions in the scientific literature. [ABSTRACT FROM AUTHOR]

Distributional implications of capital account regulation is eminently context-specific. This paper examines the distributional effects of the openness of foreign direct investment (FDI) flows across 27 European countries in different economic environments around the Great Recession, covering the period 2007–2013. Our multi-level approach allows us to combine country-level variables and sociodemographic characteristics of individuals. The results highlight that the openness of FDI flows heterogeneously affects the income share of individual groups, favouring in particular the highest income classes. This finding seems to be driven by the educational level. We argue that even though highly educated individuals are present along the entire distribution, the highest income classes are especially favoured by the openness of FDI flows. This biased distributional effect of the openness of FDI flows persists throughout the years examined, regardless of the economic environment; this is due, in part, to the fact that the distribution of highly educated people is not sensitive to the business cycle. [ABSTRACT FROM AUTHOR]

This paper analyses the impact of cyclical external shocks on the macroeconomic performance of Eurozone and EU member countries. The latter is achieved through a comparative study of two EU countries, Slovenia and Croatia, of which only the former is a Eurozone member state. Cross-country differences are observed over the 2000-2018 period, thus covering all stages of the economic cycle. The primary hypothesis is that the Eurozone economic integration provides its members with comparably greater macroeconomic stability and balanced growth rates. The research elaborates on the possibilities and effects of more autonomous macroeconomic adjustments tailored to the specific needs of non-Eurozone EU countries. Methodologically, the study exhibits an intricate nexus among theoretical, empirical, and institutional economics and shows that the impact of the country's international interconnectedness, stemming from the economic and geographical links, bears greater importance than Eurozone membership. Concurrently, this analysis confirms that whether the Eurozone's benefits outweigh the shortcoming of monetary sovereignty abnegation depends predominantly on the capabilities of individual countries and Eurozone's institutions to design and execute an effective monetary-fiscal policy mix. [ABSTRACT FROM AUTHOR]

The primary purpose of this paper is to investigate macroeconomic, financial and welfare effects of financial constraints and policy uncertainty on the economy featuring shifting trend inflation. By developing a New Keynesian model incorporating trend inflation into staggered prices and staggered credit channel, we indicate three important findings. First, we report negligible welfare consequences of financial shocks, whereas policy uncertainty shocks dampen the economic welfare considerably. More importantly, financial frictions are a channel through which policy uncertainty stuns the economy more remarkably. Second, the welfare consequences and business cycles effects of shocks are greater in the high-trend-inflation economy, while the costs of exogenous variations in trend inflation are larger if there is policy uncertainty. Third, among staggered prices and staggered credit, the later plays a more vital role in transmitting adverse effects of shocks to trend inflation into the economy. [ABSTRACT FROM AUTHOR]

The main objective of this paper is to examine the determinants of portfolio at risk in Palestine by analyzing the impact of macroeconomic and micro-level factors on credit risk for microfinance institutions during the period of 2010–2020. This study includes five regulated MFIs using generalized method of moment estimator. The findings indicate that portfolio at risk is more sensitive to the institutional factors and economic cycle. The operating efficiency and number of loan officers have positive and significant effect on credit risk. However, growth in GDP and number of active borrowers have negative and significant effect on credit risk. But, no evidence supports the impact of inflation and interest rate on vulnerability of credit risk. The conclusion presented may be useful for MFI directors and regulators in timely repayments and credit risk control. Overall, our ample evidence suggests that MFIs directors should consider the influence of institutional factors on their investment and credits decisions. [ABSTRACT FROM AUTHOR]

The COVID-19 pandemic simultaneously affected most economic sectors and has already caused severe worldwide social and economic damage. In response, authorities introduced social distancing measures, with an adverse impact on economic activity. If policymakers were aware of the existing vulnerabilities, including those derived from the positioning on the business cycle, resilience could have been increased. The aim of this article is to describe various methods of dating business cycles in several Central and Eastern European (C.E.E.) countries, namely Czechia, Hungary, Poland and Romania. Furthermore, a Probit model regarding the probability of a recession is estimated, confirming the adverse effects of the pandemic, in contrast with a brightening outlook given vaccination campaigns and the E.U. recovery package. However, in case of the Romanian economy, an in-sample estimation showed a high probability of negative growth rates even in a pre-pandemic world, due to the high macroeconomic imbalances. [ABSTRACT FROM AUTHOR]

The COVID-19 pandemic simultaneously affected most economic sectors and has already caused severe worldwide social and economic damage. In response, authorities introduced social distancing measures, with an adverse impact on economic activity. If policymakers were aware of the existing vulnerabilities, including those derived from the positioning on the business cycle, resilience could have been increased. The aim of this article is to describe various methods of dating business cycles in several Central and Eastern European (C.E.E.) countries, namely Czechia, Hungary, Poland and Romania. Furthermore, a Probit model regarding the probability of a recession is estimated, confirming the adverse effects of the pandemic, in contrast with a brightening outlook given vaccination campaigns and the E.U. recovery package. However, in case of the Romanian economy, an in-sample estimation showed a high probability of negative growth rates even in a pre-pandemic world, due to the high macroeconomic imbalances. [ABSTRACT FROM AUTHOR]

Following the advice of institutionalist Wendell Gordon, the author aims to "tell it like it is" by reflecting on his own path to institutionalism, the economic contributions of post-Keynesian institutionalism, and some of the major issues that deserve institutionalists' further attention. Several heterodox economists are identified as influences contributing to the making of this economic maverick, but so too are Barbara Jordan and Michael Harrington. Then attention is given to the institutionally focused pre-analytic vision of post-Keynesian institutionalism, the inescapable reality of business cycles in market-oriented economies, and the institutionalized myopia of money-manager capitalism. Some key issues warranting our further attention include the expansion of economic insecurity, the threat of authoritarianism, and the climate crisis. [ABSTRACT FROM AUTHOR]

Under accelerated domestic economic cycle, it is significant to predict the embodied carbon transfer network (ECTNs) to identify key emission regions to improve emission reduction efficiency. Based on the existing China Multi-regional Input-Output Table (CMRIOs) for 2002, 2007, 2010, 2012, 2015 and 2017, the CMRIOs for 2002-2017 were updated, then the ECTNs were predicted and constructed from 2018 to 2025 through Particle Swarm Optimization- Support Vector Model. Finally, the spatial and temporal evolution trends of the ECTNs' features were explored through complex networks analysis. The results showed that carbon leakage between provinces has been becoming increasingly serious. The small-world features of the ECTNs were becoming increasingly obvious. The distribution of provinces with great influence on carbon transfer was transferred from north to south, and then to the central region. Hebei, Jiangsu, Henan, Zhejiang, Inner Mongolia, and other resource-intensive and manufacturing provinces played an important "bridge" role in the trade between economic developed and developing provinces. Trade ties between non neighboring provinces have become increasingly close, which means the development of China's integration has strengthened. This study provides a theoretical reference for the formulation of China's overall carbon emission reduction policy. [ABSTRACT FROM AUTHOR]

Wesley C. Mitchell, despite his seminal contributions to the understanding of macroeconomic fluctuations, with a few exceptions, has not received the deserved attention from scholars. This article argues that his business cycles research must be updated and developed into a macro-theory emphasizing the endogenous co-evolution of the institutional influence on behavior and the typical features of a monetary economy. This development suggests that Mitchell's approach ought to be, after updated and crossfertilized with other theories, reclaimed. In order to bring his formulations up to date, complement it, and put it back to the forefront of an institutionalist macroeconomics, it seems necessary to: (i) address some important changes underwent by capitalism since Mitchell's time; (ii) intensify dialogue with heterodox currents, mainly post-Keynesians; (iii) emphasize the evolutionary aspect of Mitchell's thought, making explicit the role of institutions in this approach. [ABSTRACT FROM AUTHOR]

The impacts of energy shortages characterized by regular blackouts, natural gas, and electricity load shedding in Pakistan affected each economic sector, causing an energy-induced crisis and ecological sustainability issues. This study was conducted to reveal the benefits of renewable energy and describe the economic losses associated with electricity unavailability using supply-driven input-output as a price model across 34 sectors. The results revealed that exogenous shocks in electricity prices are responsible for bringing significant fluctuations across the business cycle in the country. Similarly, the overall output of Pakistan's economy will decrease by 24.89 rupees due to a 1-kilowatt-hour reduction in electricity supply. Moreover, both forward and backward linkages of Pakistan's economy revealed that higher electricity allocation coefficients pose significant output impacts on most sectors. We conclude that indirect output impacts require due consideration to avoid the underestimation problem due to total electricity shortages. It is recommended that the government provide a social and legal framework to boost the environmental sustainability and economic activities in the textile, oil refining, production of cement, and fertilizer sectors for sustainable economic growth. [ABSTRACT FROM AUTHOR]

We aim at investigating welfare costs of shocks as well as dynamics of business and financial cycle due to these shocks. By using the theoretical model and parameters calibrated jointly to match the selected moments for the U.S. data during 1954Q3–2018Q4 period, our findings emphasise interaction between trend inflation and shocks. In the one side, welfare costs of these shocks in the Rotemberg model are modest but these costs increase when central banks raise their inflation targets to the higher level. Under impacts of these shocks, the economy gets more volatile reflected by higher dynamics of business and financial cycles. On the other hand, we investigate impacts of trend inflation on impulse response of key macroeconomic as well as financial variables to these shocks. In almost cases, these variables reacts more strongly to the shocks for higher trend inflation levels. Importantly, there are long-lasting debt response and short-lived equity response to unexpected changes in financial conditions. [ABSTRACT FROM AUTHOR]

This article begins with an analysis of banking flows in the euro zone, through a complex network, from 2006 to 2020. This analysis allows us to observe the topology of the network through different phases of the business cycle. It is obtained that there is greater fragmentation in the network that increases in three stages, with turning points in crises. In turn, the topological structure is less random and presents more capitalized subnetworks with less risk. As for the nodes of the network, Germany gives up the position of centrality in favor of France. The determinants of the links in the network are analyzed with Machine Learning, obtaining as push and pull bank variables solvency and bank income structure, respectively, and productivity as economic variable. [ABSTRACT FROM AUTHOR]

This research investigates the relationship between efficiency and firm growth as well as the relationship between firm growth and market structure (CR4) to evaluate whether the quiet-life (QL) and/or efficient structure (ES) hypothesis applies in the Indonesian palm oil industry. This study uses large and medium industry survey data sourced from the Indonesian Bureau of Central Statistics (BPS) for the period from 1990 to 2017. The efficiency score is calculated using data envelopment analysis (DEA) using a bootstrapping approach. The two-step generalized method of moments (GMM) and panel vector auto regression (PVAR) are used to test the two hypotheses. The results show that technical efficiency can increase a firm's market share, market concentration, and market power. These results support the ES hypothesis. This research also finds that market structure (CR4) has an impact on firm efficiency, providing evidence supporting the QL hypothesis. These results indicate that the ES and QL hypotheses apply in Indonesia during a business cycle that needs to be considered by policymakers. [ABSTRACT FROM AUTHOR]

This study investigates the association between the corporate life cycle and corporate social responsibility (CSR) disclosure in Vietnam. We hypothesize that the ability and motivation of firms to engage in various CSR activities at each stage of the corporate life cycle are different. Data are collected from 218 companies listed on the HOSE and HNX exchanges in Vietnam from 2014 to 2018 to measure the CSR according to the 2016 GRI General Standards, Parts GRI 200, GRI 300, and GRI 400. Using 2SLS estimation, the empirical findings of our study are consistent with our hypothesis. Our findings suggest that the introduction and growth stages are positively associated with CSR disclosure. Firms in the decline and shake-out phases no longer focus much on CSR disclosure, which shows that older firms do not invest in CSR activities as much as young firms. This study has two contributions. First, the research findings help to expand the literature in the Vietnamese context by applying business life cycle theory and aligning CSR with corporate life cycle stages. Second, the results of this study contribute to managerial implications in making CSR dimension decisions. [ABSTRACT FROM AUTHOR]

This article studies the Kaleckian profit and profit rate in U.S. business cycles. Kalecki emphasized the critical role played by investment in the determination of profit. The alternative mechanisms that he operationalized in his discussion of profit generation usually played an insignificant role then. However, since Kalecki developed his framework for profit and its determinants, the U.S. economy has gone through some significant transformations, specifically with the neoliberal turn beginning in the early 1980s. We consider some of these changes under the new corporate governance system and shareholder-value ideology, and discuss the role they play in relation to Kaleckian profit generation. We also discuss the components of the profit, as distinct from its determinants, to discuss how the allocation of the profit within the capitalist class influences Kaleckian profit generation. Finally, we compute the determinants and the components of the Kaleckian profit rate in the post-WWII U.S. business cycles to empirically observe the influence of the neoliberal turn on the Kaleckian profit generation. [ABSTRACT FROM AUTHOR]

When Spain began the transition from the Old Regime to liberalism, the business career of the Marquis of Sargadelos was unique. In an institutional scenario in which being a 'profit seeker' was an almost indispensable prerequisite to overcoming the steep barriers to the entry of manufacturing initiatives, and in a society where the capital accumulated in commercial and manufacturing ventures was diverted to the purchase of rural land, Ibáñez was an exception to the norm in two senses: first, for his willingness to take a risk on new industries, and second, for his efforts to update the available technology. It is in this sense that he might be described as a 'Schumpeterian entrepreneur'. The aim of this article is to consider Ibáñez's business career from a new perspective, both what it has in common with the classical business cycle of the time and the unique features of his industrial initiatives. [ABSTRACT FROM AUTHOR]

This article examines Minsky's theory of inflation, as distinct from a monetary theory of inflation and a productivity-adjusted wage theory of inflation. Minsky's view on money and banking will be elucidated in contrast to orthodox banking theories, drawing a causal relation from bank credit creation to aggregate demand, profits, and inflation. This article claims that his theory is particularly relevant to modern economies in which the globalization of the production process and the decline in the power of unions have mitigated wage-led inflation while financialization has amplified the business cycle and the movement in inflation over the previous forty years. In other words, excessive bank lending has underpinned aggregate spending, which created too much "claim" on consumer goods, thus precipitating profit-led inflation. By contrast, an unavoidable financial crisis and attempts, especially by households to pay off outstanding debt, dampened aggregate demand, thus causing a slowdown in profits and inflation. [ABSTRACT FROM AUTHOR]

A stable economic condition is crucial for an organization's success. Any fluctuation in economic policy directly influences corporate-level decisions. However, exercising better governance can mitigate the adverse effect of such unstable economic conditions. Owing to this, the current research tends to disclose the impact of economic policy uncertainty (EPU) on corporate investment decisions and how this impact varies across countries having better governance quality. To achieve the underlying objective, we use the data for the years 2010–2019 of publicly listed enterprises from 6 Asian economies. The empirical analysis was performed by employing the generalized least square (GLS) and GMM techniques. The statistical analysis reveals an inverse relationship between EPU and corporate investment while a direct relationship between governance quality and corporate investment. In addition to individual impact, better governance quality can mitigate the magnitude of the adverse impact of EPU on corporate investment. Better governance can diversify the negative impacts of EPU by protecting investor rights, eliminating information asymmetric, and enhancing policy stability. Based on empirical analysis, the policy officials are directed to exert efforts for exercising better governance. Similarly, corporate managers are advised to consider the current economic situation while formulating any strategy relating to physical investment. This study is innovative as it reinforces the significance of better governance in disentangling the adverse impacts of EPU on corporate investment. [ABSTRACT FROM AUTHOR]

This article investigates the effects of the different exchange rate regimes on business cycles comovement between advanced and emerging countries. We use the Granger Causality test (VAR model) on panel data to examine the causal relationships. Our findings show the existence of a bidirectional causal relationship between output comovement and the exchange rate regimes. We check the robustness of our results by applying Dumitrescu-Hurlin (2012) panel causality test that confirms our findings. Furthermore, the impulse response functions illustrate that business cycles comovement between advanced and emerging economies responds positively and significantly to the exchange rate regimes of these two groups of countries in the short term. However, the positive effect begins to wane before being negative from the third quarter and the fifth quarter for emerging economies and developed economies, respectively. [ABSTRACT FROM AUTHOR]

We investigate the impact of high-frequency economic policy uncertainty on investments of state-owned and private-owned enterprises (SOEs and POEs), as well as short-, medium- and long-term bank loans in China by employing the mixed-frequency vector autoregression model. Impulse response analysis suggests that monthly economic policy uncertainty is allowed to have heterogeneous effects on investments and bank loans in China. Variance decomposition analysis shows that aggregating monthly economic policy uncertainty into the quarterly level underestimates the influence of economic policy uncertainty in shaping China's macroeconomy at business cycle frequencies. By further decomposing the SOEs' investment, we reveal that the effects of economic policy uncertainty on SOEs' investment are strengthened due to the existence of the injection of the government investment into SOEs. Trade policy uncertainty has a similar impact on China's investments and bank loans as economic policy uncertainty. The counterfactual analysis shows that the impact of economic policy uncertainty on China's investments and bank loans is alleviated when the interest rate channel exists. Our major conclusions are insensitive to a series of robustness checks. [ABSTRACT FROM AUTHOR]