Ekonomika https://www.journals.vu.lt/ekonomika <p>Founded in 1960 and dedicated to analysing the issues in the current economy, sectoral situation and development of business development strategies for local and foreign markets in the context of Central and Eastern European economic development. Indexed in the <em>Scopus</em> (Q4) database since 2020.&nbsp;</p> Vilnius University Press en-US Ekonomika 1392-1258 <p>Please read the Copyright Notice in&nbsp;<a href="http://www.zurnalai.vu.lt/ekonomika/journalpolicy">Journal Policy</a>.&nbsp;</p> Editorial Board and Table of Contents https://www.journals.vu.lt/ekonomika/article/view/27858 <p>&nbsp;&nbsp;</p> Algirdas Miškinis Copyright (c) 2022 Authors http://creativecommons.org/licenses/by/4.0 2022-06-16 2022-06-16 101 1 1 5 Foreign Exchange Volatility and the Bubble Formation in Financial Markets: Evidence From The COVID-19 Pandemic https://www.journals.vu.lt/ekonomika/article/view/22642 <p>This paper applies recursive right-tailed unit root tests to detect bubble activity for Turkish Lira against financially most-traded five currencies (i.e., the US Dollar (USD/TRY), the British pound (GBP/TRY), the Euro (EUR/TRY), the Chinese Yuan (CNY/TRY) and the Russian Ruble (RUB/TRY)) over January 2, 2015 to February 12, 2021. It can be identified from the Supremum Augmented Dickey–Fuller (SADF) and the Generalized Supremum Augmented Dickey-Fuller (GSADF) tests statistics that there is a high degree of evidence of bubble activity which characterizes all five exchange rates both in the full-sample period and in the sub-periods, including the pre-COVID-19 era (January 2, 2015 to November 15, 2019) and the COVID-19 era (November 18, 2019 to February 12, 2021). The empirical results also indicate that positive bubbles are common for each selected exchange rate and the multiple bubbles were intensified during the COVID-19 period, referring that forex markets became relatively more inefficient compared to the pre-COVID-19 period.</p> Onur Özdemir Copyright (c) 2022 Onur Özdemir https://creativecommons.org/licenses/by/4.0 2022-06-07 2022-06-07 101 1 142 161 10.15388/Ekon.2022.101.1.8 Dynamics of Exchange Rate Fluctuations in Turkey: Evidence from Symmetric and Asymmetric Causality Analysis https://www.journals.vu.lt/ekonomika/article/view/26205 <p>This study examines the factors affecting exchange rate fluctuations in Turkey by employing the quarterly data from 2008 to 2020. In this context, linear and nonlinear unit root tests were used to determine the stationarity levels of the variables. Then, symmetric and asymmetric causality analysis was preferred to ascertain the relationship between the variables. Symmetric causality analysis results indicated a causality relationship from the exchange rate to the long-term debt stock, from the credit default swap (CDS) to the exchange rate, and from the exchange rate to the uncertainty index. The asymmetric causality analysis showed a causality relationship from positive shocks in the short-term debt stock to negative shocks in the exchange rate. Also, it was proven that there exists a causality relationship from negative shocks in the short-term external debt stock to positive and negative shocks in the exchange rate. Another result demonstrated a causality relationship between positive shocks in the exchange rate to negative shocks in the long-term debt stock. In addition, it was found that negative shocks in net capital investment were the cause of negative shocks in the exchange rate, while it was determined that there was a causality relationship from positive shocks in the net reserves to positive shocks in the exchange rate. In conclusion, the asymmetric causality relationship from positive shocks in CDS to positive shocks in exchange rates was detected.</p> Ali Çeli̇k Copyright (c) 2022 Ali Çeli̇k https://creativecommons.org/licenses/by/4.0 2022-05-09 2022-05-09 101 1 125 141 10.15388/Ekon.2022.101.1.7 Economic Performance and Political Choice in Ukraine https://www.journals.vu.lt/ekonomika/article/view/24852 <p>In this article the economic performance as a factor that determined the political choice of Ukrainians has been analyzed. It is proven by a panel model that, unlike the countries with developed democracies, a retrospective economic vote in presidential elections was not observed in Ukraine; it turned out to be prospective instead with regard to the last (year 2019) presidential election. The authors presented a set of reasons which could explain such situation: lack of democratic experience, relying on heuristics and emotions, low public mood among the others. It has been demonstrated that Ukrainians’ political choice in 2019 has some consequences for the economy, which may contribute to the loss of a nation’s development guidelines for a certain period of time and subsequent social disappointment.</p> Sergii Slukhai Nataliia Slukhai Olena Bazhenova Copyright (c) 2022 Sergii Slukhai | Nataliia Slukhai | Olena Bazhenova https://creativecommons.org/licenses/by/4.0 2022-05-09 2022-05-09 101 1 102 124 10.15388/Ekon.2022.101.1.6 Overcoming the Inadequacy of Economic Dynamics Models https://www.journals.vu.lt/ekonomika/article/view/23951 <p>Known models of economic dynamics are too aggregate, so inadequate to the real economy. The analyst will not be able to identify the real dynamics of the economy among the big mistakes. They have no connection between investments, their efficiency, and the rate of economic growth. There is no transition from the optimal share of savings in the country to the agents’ optimal shares, managing investment sources.<br>To link investment and the pace of economic growth, the author introduced the concept of technical productivity of investments, which measures their ability to change the rate of material or labor costs.<br>Based on the technical productivity of investment, the author has derived the equation (not identity) of economic dynamics.Instead of the highly aggregated models, the author developed an adequate causal simulation model, reflecting the economy as a closed system with positive feedback of the investment from incomes and economic growth from investment. The author determined the dynamics of the Ukrainian economy with different technical productivity of investment on this model.</p> Yuriy Vasylenko Copyright (c) 2022 Yuriy Vasylenko https://creativecommons.org/licenses/by/4.0 2022-05-02 2022-05-02 101 1 84 101 10.15388/Ekon.2022.101.1.5 The Impact of Income Inequality, Renewable Energy Consumption, Non-Renewable Energy Consumption and Per Capita Income on Poverty: Evidence from BRICS Economies https://www.journals.vu.lt/ekonomika/article/view/24986 <p>The main purpose of this study is to investigate the role of income inequality, per capita renewable and per capita non-renewable energy consumption, per capita income on poverty reduction in BRICS (Brazil, Russia, India, China, South Africa) countries over the period between 1991–2019. This study used second-generation panel data methodologies taking into account cross-dependence between countries, which gives more accurate results. The outcomes of the panel ARDL unveiled that while an increase in income inequality and per capita non-renewable energy consumption increases poverty, an increase in growth and per capita renewable energy consumption decreases poverty. Based on the findings, policymakers should focus their efforts on developing an appropriate energy strategy that highlights the necessity of a renewable energy-driven economy powered by energy-saving technologies.</p> Doğan Barak Copyright (c) 2022 Doğan Barak https://creativecommons.org/licenses/by/4.0 2022-04-27 2022-04-27 101 1 62 83 10.15388/Ekon.2022.101.1.4 Financial Inclusion, Poverty, and Income Inequality: Evidence from European Countries https://www.journals.vu.lt/ekonomika/article/view/25052 <p>This study contributes to the existing literature on financial inclusion by examining the determinants of financial inclusion and studying the impact of financial inclusion on poverty reduction and income inequality in European countries. We investigate the impact of financial inclusion on poverty and income inequality in 30 European countries during 2004-2019 based on a composite financial inclusion index (FII) constructed by using principal component analysis (PCA). Then we assess the impact of financial inclusion, on poverty and income inequality, by employing the fixed effect method. The estimates reveal that, for the European countries, GNI per capita, population density, inflation, and internet users have a positive and significant impact on financial inclusion across all the regressions. Rule of law has a positive impact on financial inclusion, and the age dependency ratio has a negative impact on financial inclusion. The findings also indicate that financial inclusion is significantly correlated with lower poverty for the full sample. Lastly, the present study supports the role of financial inclusion in reducing income inequality in European countries.</p> Driss Tsouli Copyright (c) 2022 Driss Tsouli https://creativecommons.org/licenses/by/4.0 2022-03-31 2022-03-31 101 1 37 61 10.15388/Ekon.2022.101.1.3 Business Performance Evaluation Practice in Manufacturing Sector in Latvia https://www.journals.vu.lt/ekonomika/article/view/25147 <p>The manufacturing sector plays an important role in promoting Latvia’s economic growth; this sector is one of the largest sectors of the Latvian economy. Performance can be described as one of the most important categories of economic analysis; however, there is no consensus among researchers on the business performance indicators, their measurement and evaluation methods. The research is based on the analysis of special literature and scientific publications, the evaluation of the financial ratios used in the financial analysis of companies by Latvian institutions, the results of an expert survey, and data from the Official Statistics Portal of Latvia. Literature analysis, expert surveys, correlations, multiple linear regression and forecasting methods were used in the research. The aim of the research is to identify and summarize the performance evaluation practices of manufacturing companies in Latvia. As a result of the research, the business performance evaluation practice in the manufacturing sector was analyzed, the significance of the financial ratios used in the financial analysis in the business performance evaluation in the manufacturing sector and the existence of statistically significant correlations between the financial analysis indicators of manufacturing companies and the key business indicators of manufacturing companies were identified and evaluated.</p> Inta Kotane Iveta Mietule Copyright (c) 2022 Inta Kotane | Iveta Mietule https://creativecommons.org/licenses/by/4.0 2022-03-30 2022-03-30 101 1 20 36 10.15388/Ekon.2022.101.1.2 Determinants of Bilateral Trade Balance Between Georgia and China https://www.journals.vu.lt/ekonomika/article/view/25348 <p>This paper aims to empirically examine the drivers of the bilateral balance of the trade model for the Georgian-Chinese economy from 2000 to 2020 and the influence of the Georgia-China free trade agreement on the Georgian-Chinese balance of trade. The Error Correction Model (ECM) of the ARDL was used to see if the balance of trade and its predictors have a long-term relationship. One of the ARDL’s defining properties is that it may be utilized in circumstances when there is minimal data, regardless of the level of variable integration. According to the findings, a perceived effective exchange rate has a statistically significant positive impact on the balance of trade in the long run and a statistically significant negative impact on the balance of trade in the short run. The output is shaped to favor the presence of the elasticity attitude’s J-Curve impact. The study also found that the comparative supply of money (MS) and GDP have only a minor impact on the trade balance in the medium and long run. The sponging and monetary methods are ineffective in characterizing the bilateral trade deficit between Georgia and China.</p> Azer Dilanchiev Tengiz Taktakishvili Copyright (c) 2022 Azer Dilanchiev | Tengiz Taktakishvili https://creativecommons.org/licenses/by/4.0 2022-03-30 2022-03-30 101 1 6 19 10.15388/Ekon.2022.101.1.1 The Impact of Environmental, Social, and Governance (ESG) Performance on Financial Reporting Quality: International Evidence https://www.journals.vu.lt/ekonomika/article/view/24365 <p>This study investigates the relationship between environmental, social, and governance (ESG) performance and financial reporting quality (FRQ) through the use of data from Datastream, Refinitive Eikon and ASSET4 databases. The initial sample of the study covers all available firms in ASSET4. After eliminating firms with missing data, the final sample of the study consists of 16,072 firm-year observations from 35 countries, covering the years from 2010 to 2017. Several FRQ proxies and firms’ ESG performance indicators are used in the study. The panel regression findings reveal that firms’ ESG performance has a positive impact on FRQ. In other words, it has been found that improving the ESG performance of firms yields higher FRQs. As for ESG pillars, this study finds a positive and statistically significant relationship between FRQ and environmental and governance pillars. The study extends the literature by providing international evidence not only about the aggregate effects of firms’ ESG performance on FRQ but also the effects of each of the three ESG pillars on FRQ.</p> Yasin Şeker Evren Dilek Şengür Copyright (c) 2021 Yasin Seker | Evren Dilek Şengür https://creativecommons.org/licenses/by/4.0 2021-11-25 2021-11-25 101 1 190 212 10.15388/Ekon.2021.100.2.9