Eastern Journal of European Studies

Tackling the illegitimate under-reporting of salaries in Southeast Europe: some lessons from a 2015 survey in Bulgaria, Croatia and FYR Macedonia

Authors: Colin C. WILLIAMS and Josip FRANIC

Abstract: To tackle the illegitimate employer practice of under-reporting salaries, the conventional deterrence policy approach seeks to increase the penalties and risk of detection. Recently, however, calls have been made for a new more indirect approach that enhances tax morale so as to nurture a culture of self-regulation. The aim of this paper is to evaluate these two policy approaches. Reporting evidence from 6,019 face-to-face interviews conducted in Bulgaria, Croatia and FYR Macedonia in 2015, logit regression analysis reveals no association between salary under-reporting and the perceived level of penalties and risk of detection, but a strong association between salary under-reporting and the level of tax morale. The paper concludes by discussing the implications of the findings for theory and policy.

Keywords: envelope wages, tax morale, informal economy, Southeast Europe

Pages: 5-28 | Full text (PDF)

Assessing the poverty-growth-inequality nexus: the case of Macedonia

Authors: Dimitar NIKOLOSKI and Miroslav GVEROSKI

Abstract: The process of transition in Macedonia, as in other former socialist countries, has affected every domain of the political, economic, and social life. Generally, the transitional reforms initially had negative effects on labour markets, which were manifested in declining participation rates and persistent high unemployment. Long spells of unemployment have been leading to the degradation and dehumanisation of individuals in society, causing poverty and social exclusion and increasing the government's burden of providing the necessary safety net. Having in mind the rising poverty during transition, poverty reduction has become one of the highest priorities in the development policy of the Macedonian government. According to the theory, the poverty reduction objective can be achieved by faster growth and/or greater equity. In this regard, achieving an optimal combination of these two channels appears to be primarily a pragmatic issue. The aim of this paper is to assess the effects of growth and inequality on poverty in a country specific context for Macedonia. For this purpose, we first estimate the poverty growth and inequality elasticity for the period from 2000 to 2014 and we find that a higher level of inequality would reduce the poverty reduction efficiency of growth. In addition, we calculate the theoretically well established indicators such as: the inequality-growth trade-off index and pro-poor growth index which show that the growth in Macedonia during the above specified period has been generally anti-poor. Finally, we formulate policy recommendations for improving the living standard of the poor and for achieving more equitable growth.

Keywords: poverty, inequality, pro-poor growth

Pages: 29-43 | Full text (PDF)

Revisiting the 'invisible hand' hypothesis: a comparative study between Bulgaria and Germany

Authors: Nadezhda GESHEVA and Aleksandar VASILEV

Abstract: This paper examines Adam Smith's concept of an Invisible Hand of the market in light of the underlying assumptions for the theory to hold. Furthermore, the study focuses on Total Factor Productivity as a measure of efficiency of resource allocation, and employs growth accounting in Bulgaria relative to a frontier country (Germany), and tries to explain the Total Factor Productivity gap with the difference in the quality of institutions and economic freedom performance (where the latter is based on the Freedom Index Indicators). Satisfactory results have been obtained, favouring the hypothesis that freer markets perform better and a "catching up" effect of Bulgaria's Total Factor Productivity levels towards those of Germany has been observed. Finally, the study provides policy recommendations facilitating the Invisible Hand Process in Bulgaria for a more rapid convergence towards Germany's productivity levels.

Keywords: Invisible Hand of the Market, Free Market Economy, Total Factor Productivity, convergence

Pages: 45-77 | Full text (PDF)

Regional interplay of factors informing SMES' density in Romania. A panel data analysis

Authors: Elena DRUICA, Zizi GOSCHIN  and Ana-Maria GRIGORE

Abstract: The aim of this paper is to provide an understanding of several factors associated with the SMEs' density distribution across Romania, and to discuss how some of the variables acknowledged in the international literature as determinants in SMEs' dynamic are related to SMEs' density in this case. We fitted four static panel models, one for each category of SMEs, and found a positive impact of both GDP per capita and FDI per capita on the SMEs' density in each category, which may confirm our initial assumption that SMEs' density can act as a signal for business opportunity. The density of employees in the research - development sector did not account for any significant contribution, while the percent of people in the 25 - 34 age group is statistically significant but holds an opposite sign to what was expected. Last, but not least, the crisis had an unexpected impact on our dependent variables.
Keywords: panel data econometrics, fixed effects models, SMEs density, regional inequality

Keywords: Invisible Hand of the Market, Free Market Economy, Total Factor Productivity, convergence

Pages: 79-95 | Full text (PDF)

Social responsibility in Ukrainian agriculture: the regional issue

Authors: Larysa LEVKIVSKA  and Inna LEVKOVYCH

Abstract: The social responsibility of agribusiness is currently one of the highly debated issues. Factors such as the globalization of agri-food supply chains, increasing competition, further integration of Ukraine in Europe and the world market, developments of Ukrainian large scale farms as well as public pressure on farms make the analysis of Corporate Social Responsibility (CSR) highly relevant to Ukrainian agribusiness. The paper provides insights on the understanding of CSR by the Ukrainian agricultural enterprises, CSR activities implemented by farms and main drivers encouraging the implementation of CSR initiatives. The analysis is based on literature reviews and questionnaires of Ukrainian agricultural enterprises and representatives of the local community in Oblasts Zhytomyr, carried out in spring 2016.

Keywords: corporate social responsibility, agriculture, agribusiness, agroholdings, rural development, Ukraine

Pages: 97-114 | Full text (PDF)

Managing the competitiveness in CIS countries and Ukraine: the goal and conditions

Authors: Anna KUKHARUK, Julia GAVRISH and Danyil ZMITROVYCH

Abstract: The study is focused on the analysis of conditions for business development and the industrial enterprises' competitiveness formation in Commonwealth of Independent States (CIS). The study is based on several concepts - sustainable development, macroeconomic stability, "green economy", and competitiveness. The article analyses the level of macroeconomic instability in a sample of CIS countries and Ukraine following the statistical approach and using the variation coefficient. The authors suggest calculating the indicators of stable development (SD-indicator) and business simplicity (SB-indicator) based on the international analytical reports data. Several CIS countries are visualized in SD and SB coordinates. The study defines the countries where the conditions for business competitiveness are to be improved due to the comparatively higher level of macroeconomic instability. The article will be interesting to scientists whose subject of research is the competitiveness of enterprises or the economic instability phenomena.

Keywords: competitiveness, industrial company, CIS countries' development, macroeconomic stability, management goal, conditions for doing business, sustainable development, green economy

Pages: 115-136 | Full text (PDF)

Within the media earshot: national ideas in the Republic of Moldova prior to the 2016 election

Author: Onoriu COLACEL

Abstract: A decade-old war of words is raging in the Moldovan media, amid renewed calls for the country to denounce the association agreement with the EU. Igor Dodon's win in the runoff of the presidential election on 13 November 2016 fuelled the dispute about whether the country should remain on its European course or not. As always, propaganda wars and the ethnic background of those involved in the debate never fail to capture the imagination of foreign media. However, local audiences make choices that fall outside the modes of expression perceived as being popular with the major players in the information market of the RM: the Russian Federation, Romania, the Chisinau elites and the EU. The media-related communication of the Moldovans shows that their beliefs about nationalism are not necessarily shaped by the reception of Romanian or Russian-language media. Instead, their responses to media exposure point to poor national mobilisation.

Keywords: the Republic of Moldova, Moldovan media, regional self-definitiony

Pages: 137-155 | Full text (PDF)

Concepts, approaches and methods on Europeanisation - a meta-analysis

Author: Zoltan GRUNHUT

Abstract: The present paper aims to overview the most relevant conceptualisations on Europeanisation with the goal to contribute for the better ontological and epistemological understanding of the notion. The meta-analysis was done in a framework concerning two main features of the selected concepts: first, how they interpret Europeanisation, as an explanans that explains other factors, or as an explanandum that is explained by different variables; and secondly, on which level(s) - macro, meso and/or micro - these concepts identify the core specificities of the notion. The main findings are presented through a theoretical differentiation of three generations of studies on Europeanisation. The first one is a more functionalist, constructivist and normative approach that mainly focuses on the macro-level aspects; the second generation is rather institutionalist, generally structuralist, and it prefers the meso- and micro-level; while the third period seems to shift to a more agent-based micro-level discursive, post-structuralist direction, while constructivist studies are rising in number as well.

Keywords: europeanisation, concepts, institutionalism, structuralism, constructivism, post-structuralism

Pages: 157-176 | Full text (PDF)

Migranthood and self-governing rights: a new paradigm for the post-communist Eastern Europe

Author: Francesco TRUPIA

Abstract: Nowadays migratory phenomena impinge on the sphere of human security and democracy over Eastern Europe, in turn affected by the threat of ethnic turmoil and instability alongside national borders due to the high-level of disloyalty that national minorities have been showing since the collapse of the Soviet and Yugoslavian regimes. Since 2015, the wider region has started to constantly deal with the humanitarian refugee crisis within its geographical corridors and routes, throughout an abundance of human rights violations, the rise of selfish boundary policies and stubborn nationalisms that has exacerbated the public realms among locals and newcomers. This paper aims to lay out an overview of the interstate relations in light of "migranthood" phenomenon in order to feed the implementation of self-governing rights as an essential strategy to fully secure the States of the Eastern Partnership Agreement, and facilitate the process of democratization of the latest EU Member States and EU Candidate States.

Keywords: migranthood, human security, self-governing rights, national minorities, post-communism, Eastern Europe

Pages: 177-195 | Full text (PDF)

BOOK REVIEW:

Sieglinde Gstohl and Simon Schunz (eds.), Theorizing the European Neighbourhood Policy, 2017 

Author: Cristian NITOIU

Pages: 197-203 | Full text (PDF)