To explain and tackle employers who illegally under-report their employees’ salaries to evade paying the full tax and social contributions owed, these employers have been conventionally explained as rational economic actors doing so when the benefits outweigh the costs, and thus the solution is to increase the sanctions and/or probability of detection. An alternative social actor approach, however, explains employers as under-reporting salaries because of their lack of both vertical trust (i.e., their beliefs are not in symmetry with the laws and regulations) and horizontal trust (i.e., they believe many others are non-compliant). Reporting a 2015 survey of 450 employers in FYR Macedonia, the finding is that there is no strong association between employers under-reporting salaries and their perceived level of penalties and risks of detection, but a strong significant association with both their level of vertical and horizontal trust. The theoretical and policy implications are then discussed.
Guided by managerial theory and behavioural economics, as well as the literature on exporting, this study combines the upper echelons perspective with the Melitz model to analyse the export behaviour of firms. Thus, it controls for the influence of managerial characteristics, neglected so far in the literature on firms’ export choice and degree in transition countries. The empirical analysis is based on a random sample of 500 Kosovan SMEs. Results provide support for the key hypothesis that both subjective and objective managerial characteristics are crucial for export decisions. In line with the strategic choice paradigm and behavioural economics, findings provide support for the influence of the habituation and rational expectations effect, as well as manager’s education and international exposure on export performance. Further, Kosovan firms are self-selective in their export behaviour in terms of productivity supporting the Melitz model. However, no evidence is found for the significance of institutional factors, even after performing factor analysis.
The purpose of this study is to examine links between, on the one hand, employee satisfaction, loyalty and performance, and on the other, the relationship between customer satisfaction and loyalty, as well as their inter-relationship. We conducted a study with employees (53 employees) and students (262 students) across seven departments of a private university in a developing European country. In order to test the cross-level effects of employee-level constructs on student-level constructs, a multilevel analysis was conducted using hierarchical linear modeling. The results confirmed the positive effect of employee satisfaction on employee loyalty and employee performance, but not the impact of the employees’ loyalty on their performances. At the same time, the results showed that students’ satisfaction was positively related to loyalty. Finally, the results showed that, unlike employee performance, employee loyalty at the level of the department had a positive and significant impact on the students’ loyalty and also enhanced the effect of students’ satisfaction on student loyalty.
The purpose of this paper is to present a review of 85 international studies of cross-cultural variations in consumer behavior, conducted in 2000–2016; to systemize conceptual and methodological approaches to research of cross-cultural variations in consumer behavior; to identify conceptual and methodological gaps and empirical issues in these studies; to pose research questions; and to set directions for future research.
This literature review reveals the lack of a unified conceptual approach to defining cross-cultural variations and the absence of a unified terminology related to cross-cultural research. It also highlights methodological areas susceptible to common method bias, which hinders the establishment of equivalence in studies of cross-cultural variations in consumer behavior. This review accentuates the “cross-cultural variations” concept in consumer behavior research covering both differences and similarities, which are the subject of cross-cultural studies.
The aim of the paper is to analyze the convergence process among the former Communist countries, the CEE-countries, the Western Balkans and the Eastern Partnership countries. Beta convergence is based on the neoclassical growth theory and tests the hypothesis that poor countries tend to grow faster than rich countries, in per capita terms, and can be absolute and conditional. There are two main hypotheses of this research. The first hypothesis is that the recent financial crisis negatively affected the absolute convergence process among the analyzed countries. The second hypothesis is that the recent financial crisis negatively affected the conditional convergence process among the countries. The relationships between the selected macroeconomic variables and per capita GDP growth rate are econometrically tested. Beta convergence is estimated for the period 2004-2016 and sub-periods; 2004-2008, the pre-crisis period and 2009-2013, the period of crisis. The empirical findings support the economic convergence hypothesis.
This study examines the impact of the “institutions” on the economic development of Kosovo. Kosovo, is a newly-established independent country, and it is a transition economy since it was an autonomous region of former Yugoslavia. Based on this background, the aim of this study is to contribute to the New Institutional Economics (NIE) literature in both the nation-building and transition economies contexts. Since a detailed analysis of a single country is required, a qualitative case study was preferred as a research strategy. Different sets of secondary data were collected and analyzed by using the Qualitative Content Analysis. Findings suggested that consistent political conflicts, and lack of legitimacy of the governing bodies were the main reasons for the weak institutions and poor economic performance, due to the lack of clear reforming agenda. However, characteristics of political conflicts and lack of legitimacy differed during the state-building (1999-2007) and independence (2008 onwards) periods.
Sustainable tourism plays a dominant role in the economic well-being of the Mediterranean countries, especially small ones. Tourism earnings account for a significant proportion of their GDP, and they have an overwhelming reliance on tourism as a source of exports. The general trends in tourism earnings and volatilities in country risk ratings often go hand in hand, especially for small touristic countries in that region. The research presented in this paper provides a comparative assessment of the international country risk ratings and highlights the importance of the tourism earnings and export. This study employs the ordered response and Poisson count panel data model for a sample of ten Mediterranean countries. The aim of this study is to investigate whether the tourism determinants of sovereign credit ratings for Mediterranean countries vary between different rating agencies (Standard & Poor’s, Moody’s and Fitch’s). The key finding is that an increase in tourism earnings as a proportion of GDP and as the main export share in the total country export impairs the sovereign risk rating and turns out to be robust across the different methodologies.
Keywords: tourism earnings, sovereign credit ratings, Mediterranean countries, ordered response panel model
This paper explores the size of informal economy in Bosnia and Herzegovina (BiH) over the period 1998-2016, based on an indirect method of measurement known as MIMIC approach (Multiple Input Multiple Causes). As the underlying determinants of informal economy in BiH we include tax burden, the level of unemployment, the size of agricultural sector and the level of government subsidies. We estimate that the average informal economy for the observed period was 34% of GDP, being the largest in 1998 (43%) and the smallest in 2009 and 2016 (30%). There is a modest decreasing trend of the size of informal economy over time. Our model identifies two structural brakes over the observed period; the first positive one is linked to the introduction of the value added tax in 2006 (a decrease in 2007-2009 follows) and, the second one captures a short-run negative effect of the latest global economic crisis in 2009 (an increase 2010-2011). To further asses these results and check their consistency with available primary data, we investigate the size of the undeclared work, assess tax morality and additional income of families coming from informal sector; these indicators provide consistent results with the MIMIC outcomes.
In this paper we investigate the impact of environmental taxes on CO2 emissions in the context of emerging market economies. An attempt has been made to identify what role environmental policy and specific tax policy measures play in understanding the relationship between economic development and environmental degradation. The empirical analysis covers ten Central and Eastern European countries in the period from 1995 to 2015. The latest data on environmental taxes are available only from 1995. We contribute to recent literature in two respects. First, we study this relationship within a dynamic framework in which we take into account the issues of serial correlation and endogeneity in the regressors due to the cointegration relationship. Specifically, we rely on the fully-modified least squares (FM-OLS) estimation technique to model the long-term relationship between income and carbon-dioxide emissions. Second, this paper advances our understanding on the effectiveness of tax policy measures in curbing CO2 emissions, on which we have scarce empirical evidence. The results of this analysis provide rather strong evidence in support of an inverted U-shaped relationship between economic growth and the environment. However, environmental taxes do not seem to be effective in modifying the behaviour of economic agents and in protecting the environment. The results are robust to different models.