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The Political Budget Cycle of Municipalities in The Czech Republic
Pinlová, Adriana ; Kalabiška, Roman (advisor) ; Palanský, Miroslav (referee)
This thesis focuses on the political budget cycle at the municipal level in the Czech Republic. Using a sample of all 6 254 municipalities observed between 2010 and 2022, it examines whether elected councillors manipulate the public budget in an attempt to secure re-election. Using a fixed effects model, it anal- yses the influence of election and pre-election year on changes in the volume and structure of municipal expenditures. The thesis also offers a comparison of municipalities with extended powers, municipalities with an authorised mu- nicipal office and the remaining smaller municipalities. The results confirm the presence of a political budget cycle for all types of municipalities in the Czech Republic. Before elections, there is usually a reduction in current expenditures (especially in the area of administration) and a subsequent increase in capital expenditures (especially in the areas of transport, culture, sport and leisure activities), which are highly visible and attractive to voters.
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Effects on Stock Prices of Companies Involved in Leaks of Offshore Documents
Odvárková, Zuzana ; Palanský, Miroslav (advisor) ; Secchini, Valeria (referee)
This thesis studies the effect of leaks of secret offshore documents on the value of the implicated firms. Using the entirety of International Consortium of Investigative Journalists' (ICIJ) Off- shore Leak Database, we identify 206 publicly traded firms connected to the implicated offshore firms. Then, we use propensity score matching to obtain a sample of similar non-implicated companies. Finally, the leak's impact on the stock price of both groups is studied using event study methodology. We find implicated firms to have 1.5% lower cumulative abnormal returns during the event window than similar non-implicated firms. Moreover, we provide an updated figure of 105 Million USD of average lost value per firm caused by the leak.
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Let the young vote: Potential effects of lowering the voting age on elections in Czechia
Čejka, Štěpán ; Palanský, Miroslav (advisor) ; Mošovský, Jan (referee)
Several countries throughout the world have already adopted a reform that enables younger voters, from 15 or 16 years old, to vote. This thesis examines the potential influence of including such voters in the Czech Republic on recent elections. A key feature of my work is that it combines several methods together to model the voter turnout of this age group. To estimate the potential voter turnout of the 15 to 17-year-old category we use fixed effects estimation, together with the exact numbers of citizens from the 2021 state Census and combine them together with the results of Student election that are held by the People in Need organization. The uniqueness of this thesis is that we model the voter turnout in every of the 76 Districts from the 2012 Region election until the 2021 Chamber of Deputies election. We particularly focus on the 2017 Chamber of Deputies and the 2018 Presidential elections both with very narrow outcomes. Finally, we estimate that the inclusion of the young voters most likely would not alter the results of neither election.
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Effect of Enhanced Financial Transparency on Foreign Aid Captured by Elites
Žalman, Jan ; Palanský, Miroslav (advisor) ; Janský, Petr (referee)
This thesis estimates the capture of foreign aid in developing countries, where elites divert the aid intended for economic growth and poverty reduction to offshore bank deposits in tax havens. Using publicly available data, we analyze the relationship between aid disbursements and offshore deposits and find that while the aid capture persists since 1990, the enhanced financial transparency has had a diminishing impact. We also investigate the role of portfolio invest- ment and corruption, emphasizing the importance of addressing these issues to ensure effective aid redistribution. Our findings suggest that the individu- als benefiting from the flow of funds to tax havens during aid disbursements are likely ruling elites, highlighting the need for greater transparency in aid distribution. JEL Classification F35, O19 Keywords aid capture, offshore bank deposits, foreign aid, fi- nancial transparency, tax havens Title Effect of Enhanced Financial Transparency on For- eign Aid Captured by Elites 1
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What Drives the Location of Profits: Examining the Behavior of Multinational Enterprises from Country-by-Country Reporting
Boukal, Tomáš ; Janský, Petr (advisor) ; Palanský, Miroslav (referee)
Multinational enterprises (MNEs) are increasingly using offshore financial centers to pay lower taxes on their profits. This behavior has distortive effects on the global economy, as the concentration of MNE activities resembles the global map of taxation. In this thesis, I exploit the OECD country-by-country reporting statistics to analyze the determinants behind the location of profits. I employ a gravity model and demonstrate that profits are highly sensitive to geographical proximity, with both physical and societal distance being significant factors. Furthermore, my findings suggest that, first, the existing literature's definition of financial secrecy lacks a conclusive role in attraction of extra profits, as its effects are likely to be already conveyed through taxation. Second, regarding the profits specifically located in offshore jurisdictions, a reverse gravity relationship exists, where multinationals are willing to incur extra costs to shift profits to more distant tax havens, revealing yet another geographical aspect of taxation.
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Effects of Population Ageing on the Pension Systems in EU
Králová, Adéla ; Kalabiška, Roman (advisor) ; Palanský, Miroslav (referee)
This bachelor's thesis comprehensively analyses the demographic and economic challenges of selected European countries due to an ageing population. The study involves a demographic projection for the period up to the year 2150, highlighting the anticipated increase in the old-age dependency ratio, thereby imposing a growing burden on the working-age population. The significance of individual demographic variables on the old-age dependency ratio is anal- ysed in the panel data regression, indicating that life expectancy has the most significant impact. The demographic projection is further utilised to construct generational accounts to calculate generation-specific pension payments and ex- penditures. Generational accounts show that increasing payments from younger generations will not be enough to cover future pension expenditures, indicating the long-term unsustainability of the PAYG system.
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Global corporate tax reforms and how they might reduce profit shifting of multinational corporations
Pravda, Matúš ; Janský, Petr (advisor) ; Palanský, Miroslav (referee)
Global corporate tax reforms and how they might reduce profit shifting of multinational corporations Matúš Pravda 3rd January 2023 This study examines whether global corporate tax reforms might increase tax revenue which was reduced by the profit shifting of multinational corpora- tions. These reforms have been built on the minimum corporate tax rate and redistribution of undertaxed profits. Tax revenue gains of jurisdictions under all three tested global models show significant improvement in contrast to the status quo. Pillar II proposal would bring USD 198 billion in extra revenue, METR proposal USD 305 billion and the Tax deficit model USD 214 billion in 2017. However, significant differences are observed between geographical re- gions and income groups. North America and the EU are the largest recipients of extra tax revenue whereas Africa and Latin America & the Caribbean Islands are the smallest. Income group results show the same composition with high- income countries contributing by around three-quarters to the extra revenue gains. BEFIT Scenario 2 would result in USD 33 billion in extra tax revenue for the EU Member States, which is double the amount of Scenario 1. 1
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The relationship between populism and COVID-19 vaccination rates in the Czech Republic
Bazaykina, Anna ; Palanský, Miroslav (advisor) ; Bauer, Michal (referee)
The bachelor thesis raises the problem of how political preferences can affect the readiness of people to be vaccinated in the Czech Republic. The entire study is provided at district level. The study primarily focuses on populism as main factor which negatively influences on people vaccination activity. The research defines two major populist parties: ANO party and SPD party. The study includes theoretical and empirical approaches. Theoretical analysis explains what specific characteristics electorate of populist parties has and how these characteristics could be related with unwillingness to be vaccinated. Empirical analysis includes graphical analysis and regression model analysis. Graphical analysis helps to understand how cumulative vaccination rate (%) changes over time in different districts. In other words, graphical analysis visualizes how the difference in vaccination rate between populist and non-populist districts develops over time. Another graphical analysis which shows how rate of growth of vaccinated people (%) changes over time helps us to identify time trend. Time trend is needed to be constructed in order to build more precise regression model. Regression model analysis is used in the thesis in order to confirm the assumption that districts which express their support for...
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