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Synchronization of the Business Cycle of Slovakia and the Eurozone through the Industrial Production between the Years 1999-2014
Lipovská, Monika ; Janíčko, Martin (advisor) ; Babin, Jan (referee)
The bachelor thesis treats the synchronization of the business cycle of Slovakia and the eurozone through the industrial production between the years 1999-2014. The aim of the thesis is to verify or to falsify the hypothesis whether there is a synchronization of the business cycles of chosen economies and subsequently characterize this synchronization. The thesis is divided into several parts that intersect themselves. The first one summarizes the actual state of knowledge in the area of the economic cycles. The second chapter offers summary analysis of the respective phases of the business cycle that the Slovak republic and the eurozone noted in their modern history. In the next part the mutual synchronization is empirically evaluated by the correlation coefficient of the cyclical component of time series of the industrial production index of the two selected economies and then the time series are divided into three periods which record the development of the synchronization of the cyclic fluctuations in time. Related to this, the delays of the Slovak economic cycle are tested in comparison with the European cycle. To check the synchronization, the suitable vector autoregressive model is selected and confirms the defined hypothesis and shows that not only does the Slovak economic cycle depend on the economic cycle of the eurozone, but it is developing in the same way and the Slovak economy is adjusting to the European one. At the end of the thesis the theoretical and simulated outputs are summed up in the short discussion.
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Why Should a Value Added Tax Increase Prices of Consumption Goods?
Macek, Jan ; Potužák, Pavel (advisor) ; Janíčko, Martin (referee)
In my bachelor thesis, I present the view of modern mainstream economics on price formation and effect of taxes on price level. Then, I contrast this view with the theory of Austrian school of economics. While the mainstream economic theory assumes certain fraction of the VAT-rate to be passed forward immediately, that action does not have support in the Austrian theory of price formation. According to Austrian economists, passing the costs of taxation forward takes time. The prices of consumption goods rise because of lower quantity supplied, which is caused by lower demand for factors of production. The thesis hypothesis is proven correct by econometric model estimating a statistically significant rise in aggregate price level as a result of VAT-rate rise. Assumption of statistically significant rise in price level in a month before the VAT-rate rise was not proven correct.
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Leading, coincident and lagging indicators in the U.S. business cycles
Bon, Andrew ; Janíčko, Martin (advisor) ; Prokop, Jaromír (referee)
This thesis focuses mainly on analysing leading indicators of business cycles within the USA since the 1960s until the present, while providing theoretical background to the coincident and lagging indicators. United States is a country with incredibly rich amounts of data, which enable a thorough analysis of individual variables. First part is dedicated to different theories that explain the behaviour of cyclical fluctuations, such as a monetarist, Keynesian, or real business cycle approaches are included, followed by defining individual cyclical indicators with the provision of examples. Second part consists of actual analysis starting with dating post-war cycles and real GDP development. Three leading indicators are then analysed and evaluated, specifically the amounts of building permits issued, spread between a 10-year Treasury constant maturity bill and Federal funds rate and finally the unemployment insurance claims. Evaluation is based on individual success rates obtained from historical data. The third and final chapter attempts to forecast the economic outlook of the current business cycle using obtained data from the previous chapter. Conclusion provides an overall summary of individual parts along with pointing out the main findings.
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Foreign direct investment and investment incentives realized in Czech republic
Vaněk, Martin ; Janíčko, Martin (advisor) ; Babin, Jan (referee)
This bachelor thesis is thematically focused on foreign direct investments which constitute one of the key factors determining the national economy. It characterizes direct investment inflows into the Czech Republic and development of investment incentives implemented in the Czech Republic in the period from 1998 to 2014. The contribution of this thesis is to determine the theoretical importance of investment incentives for locating investors and confront this theoretical knowledge with development of inflows of foreign investment. Aim of this work is fulfilled by performing statistical testing concentrated on dependence of inflow of FDI on investment promotion. Attention is paid to the evaluation of the system of investment incentives and answering the question whether investment incentives implemented in the Czech Republic are a suitable tool for attracting foreign investors.
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Determinanty ziskovosti leteckých tras v Evropské unii
Tománková, Ivana ; Lahvička, Jiří (advisor) ; Janíčko, Martin (referee)
This thesis examines the determinants of air route profitability in the European Union and the cooperating countries of Norway and Switzerland. Building on the assumption that only profitable routes are served, I develop a set of probit models that specify route service as a function of route characteristics, airline networks' attributes, airline partnerships and competition. Estimation results show that route profitability increases with population size and decreases with flight distance and the time efficiency of car travel relative to air travel. An airline's airport presence, that is, its share of airport operations, exerts a significant, positive effect on its route profitability, and so does airport presence of its group or allied partners. Competitive effects are asymmetric across airline business types. This paper's contribution to existing airline-route profitability studies lies in accounting for airline cooperation, controlling for an alternative mode of transport, and using EU data for estimation.
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CNB Monetary Intervention in Global Context
Bejdová, Markéta ; Potužák, Pavel (advisor) ; Janíčko, Martin (referee)
This diploma thesis describes the intervention of the Czech National Bank in November 2013 in terms of current economic theory and practice as well as its justification. In the first theoretical part is presented actual literature dealing with the zero lower bound (ZLB). This part is divided to general description of ZLB, its prevention and possibilities of monetary policy. Further are described experiences from Japan and other countries which achieved ZLB. In this context is also presented intervention made by the Czech National Bank. Hypothesis whether the intervention was justified is tested by linear and nonlinear Taylor rule. Estimate is made by the least squares method using quarterly data from the CSO and CNB. The results of model confirm the hypothesis, which means that the optimal monetary policy interest rate would fall below zero.
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Analysis of household consumption expenditure with respect to VAT
Čížek, Pavel ; Janíčko, Martin (advisor) ; Chytilová, Helena (referee)
The constant increase in public sector spending in the advanced economies, increases pressure on the revenue side of public budgets. The primary sources of public budgets are taxes. This raises a question of what type of tax instrument to choose in respect to meet the high efficiency in sourcing public budgets restriction and at the same time, to minimize the negative impact on the private sector and households. As generally effective tax is considered a consumption tax. But what is the real effect of this tax in the short run and long run? The aim of this thesis is to analyze the influence of value -- added tax (VAT) on household expendictures in the short and long run. At first I provide empirical test of the short-term effect of VAT on household spending using quarter panel data for Visegrad fore countries, as I am focused mostly on the Czech Republic and Slovakia. Then construct a broader set of data for 14 EU countries, in purpose to test the long-term effect. For testing, I use several estimation techniques for panel data, taking into account the dynamic nature of these data sets.
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Essay on Financial Innovation, Credit Constraints, and Welfare
Janíčko, Martin ; Chytil, Zdeněk (advisor) ; Tlustý, Adolf (referee) ; Pavelka, Tomáš (referee) ; Frait, Jan (referee)
The submitted thesis is composed of three different articles dealing with issues of financial innovation, credit constraints, and their impact on welfare. The first article treats the contemporary theoretical grasp of the interaction between the financial and real economies, focusing primarily on the role of modern financial innovation in the business cycle. For this purpose, a framework promoted by the Regulation School and Post Keynesians is frequently employed, whilst some other unorthodox streams and mainstream economics are partially discussed as well. All of them aspire -- either per se or under the pressure of the contemporary economic agenda -- to clarify the evolution of financial innovation and credit in the recent era. It is generally found that certain consensus across the schools of economic thought exists, but some of them have done a better job in predicting the consequences of the financial innovation for real economic activity than others. Further, two dynamic macroeconomic models are developed in order to, inter alia, identify the possible effects of extended credit availability presented in the former article on the example of the housing market, and simulate the effects of housing price changes on general welfare. Clearly, this part of the thesis exhibits the indirect consequences of financial innovation as, once again, being rather ambiguous: after having partially unleashed the unprecedented credit granting in the economy, impacting interest rates and loan-to-value ratios, with a subsequent impact on housing prices, it has also influenced credit constrained and unconstrained households in a different manner. Based on an analysis of the situation using partial and general equilibrium analytical frameworks, two somewhat different conclusions are drawn up with respect to the occurrence of various shocks in the models. Under the partial equilibrium framework the effects of relaxation of credit constraints are visible and quite straightforward, indicating relatively simple and intuitive relationship between the price appreciation and general welfare. This is primarily perspicuous for the credit constrained households. In the general equilibrium framework, on the other hand, the transitional dynamics of shock proliferation is more transparent and the impact on credit constrained vs. unconstrained households is more ambiguous and much different from the basic intuition used in the article anchored in the partial equilibrium toolbox.
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The impact of the tax havens on the public finance of Slovakia
Pištejová, Jana ; Janíčko, Martin (advisor) ; Mičúch, Marek (referee)
International tax planning deals with the tax benefits, their seeking and using by the tax entities and corporations. Even if the tax havens are generally considered as small islands, the different types of tax advantages are offered by the developed countries of the North America or Europe. This paper focuses on the analysis of the inward of foreign direct investments into the European countries with the preferential tax regimes. It explains the relationship between the inward of the investments and the factors which affect them. The inward of the foreign direct investments is the dependent variable, the independent variables are tax rates on corporate income, unemployment, as well as political stability. Although results of econometric analysis did not confirm our initial hypothesis that the lower tax burden will increase the inward of the investments to the country, this increase can be caused under the other circumstances, such as secrecy, property protection, stable political situation or simplicity and utility of the financial markets.
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Does Foreign Direct Investment Affect Labour Productivity in the Automotive Industry? The Czech Republic Case Study
Moravcová, Martina ; Janíčko, Martin (advisor) ; Svoboda, Miroslav (referee)
The aim of this thesis is to show effects of foreign direct investment on labour productivity in Czech automotive sector in the period 2004-2009. The effects are measured through horizontal spillovers (technology transfer) representing the influence of foreign firm on Czech automotive sector and through Herfindahl index representing market concentration in the automotive sector. Based on models used in this thesis I have found out that between labour productivity and technology transfer of foreign firms in the automotive sector is not significant relationship, but labour productivity is positively and significantly influenced by market concentration in the sector. These findings do not correspond fully to widespread opinion that foreign direct investments enhance labour productivity of domestic firms by bringing new knowledge or technology. These findings correspond only to the hypothesis that higher concentration of the sector caused by foreign presence positively influence labour productivity.
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