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Assessing the Impact of the Deep and Comprehensive Free Trade Areas on Foreign Trade: the EU-Georgia, EU-Moldova, and EU-Ukraine DCFTAs
Cai, Yaqi ; Paulus, Michal (advisor) ; Akdogan, Idil (referee) ; Svoboda, Karel (referee)
Assessing the Impact of Deep and Comprehensive Free Trade Areas on Foreign Trade: the EU-Georgia, EU-Moldova, and EU-Ukraine DCFTAs Abstract The Deep and Comprehensive Free Trade Areas (DCFTAs) are three free trade areas established between the EU and Georgia, Moldova, and Ukraine, respectively. This paper provides the estimates on the effects of the DCFTAs on foreign trade. Using gravity model on a sample of 178 countries during 2002-2019, we obtain the following results. First, the DCFTAs have significantly enhanced the trade between the EU and three countries, and also facilitated the exports of other countries to the EU and three countries, while the exports of the opposite direction have been restrained by the DCFTAs. Second, the positive influence of the DCFTA on the trade with the EU is significant for Ukraine, and not significant for Georgia and Moldova. Third, in terms of the Central European countries, the DCFTAs have promoted the trade with three countries for Hungary, Czech Republic and Slovakia, whereas the positive effect is not significant in cases of Austria, Germany, and Poland. For Slovenia, the impact is also insignificant but negative. Fourth, the full implementation of the DCFTAs has additional contribution to the trade between three countries and Hungary, Czech Republic and Slovakia....
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Can a Dual-beta Five-Factor Model Explain Stock Market Variation in CEE?
Lu, Shuhong ; Čech, František (advisor) ; Chondrogiannis, Ilias (referee) ; Paulus, Michal (referee)
The study applies a dual-beta five-factor model to investigate how return is correlated with market factor, size, value, profitability and investment factors in the CEE region. Dual betas are employed in a pooled regression to account for different behaviour in different market conditions. The results show that market factor is significant across the sample period from 2003 to 2017, and the coefficient of the market factor is lower in bearish market and higher in bullish market. By employing dual betas, the explanatory power of a model has increased. However, the effect is limited, and we do not recommend using the dual-beta model due to the loss of simplicity. Post-regression diagnosis has confirmed the appropriateness of using our model by checking the key assumptions of Ordinary Least Square. Limitations are presented at the end to suggest future study.
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Estimating the Extent of Inefficiencies in the Czech Health Care System
Pachovský, Tomáš ; Janský, Petr (advisor) ; Paulus, Michal (referee)
In this thesis, we tried to find possible methods of estimation the extent of inefficiencies in healthcare and apply them on Czech data. We reviewed recent literature on this subject and from the literature we selected 3 methods that were used in this thesis. We estimated that costs of error and fraud concerning payments and provision of care in 2010 is roughly between 9,5 to 25,8 billion CZK, extra treatment for people abusing prescription opioids cost approximately 247,8 million CZK in 2011 and that costs of unnecessary use of C-Section in 2011 amounted to 184,4 million CZK. We also broke down the 2010 Czech healthcare expenditures and compared indicators across countries to uncover other possible problems.
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Public Procurements as a Corrupting Sector in RBC Model
Paulus, Michal ; Baxa, Jaromír (advisor) ; Gregor, Martin (referee)
The aim of the thesis is to create a RBC model incorporating corrupting sector. The thesis contributes to the few existing DSGE models with corruption by introducing the corrupting sector into the sector of firms and political parties which is regarded as a sector of public procurements where firms bribe politicians for gaining public tenders. This setting is new and is supposed to catch better the phenomenon of political corruption. The model predicts that all shocks that positively affect the economy motivate firms to invest more into the bribes and vice versa. The increase of the overall level of corruption stimulates economy but is leading an economy to the instability. The model also examines the effect of various forms of fiscal spending in the households ' utility function. The model exhibits several non-intuitive results (too high portion of stolen money by firms, stimulation of the economic performance caused by higher corruption and negative holding of government bonds) that should be solved in next research.
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Innovation Benefits from European Union Ascendancy: An Econometric Analysis.
Nguyen, Lisa ; Paulus, Michal (advisor) ; Figueira, Filipa (referee)
This paper investigates the benefits of joining the European Union (EU) and its impact on innovation for two indicators: patents and R&D expenditure. Based on a sample size of 27 countries within the EU observed over the time period 1996 to 2013 and utilising the GMM, FE and OLS models, I showed that, overall, entry into the EU has provided substantial benefits. Nevertheless, not all of the indicators of EU benefits are significant and sometimes did not provide positive impact on innovative activities. My evidence also suggests that with a further breakdown into two different regions, Western and Eastern Europe, there is a further rift in gains. Financial integration, for starters, has had a negative impact on innovation for both Western and Eastern Europe. Nevertheless, for the entire EU, financial integration has a positive impact on the number of patents filed. I also showed that another benefit of joining the EU, free movement of labour, has a negative and significant effect on both innovative indicators. This is consistent with the idea not all benefits of the EU provide a positive impact on innovation. Further research is warranted due to the insufficient time period.
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Does Aid Lead to More Trade? Evidence of the Effect of US Aid on its Exports
Schütz, Anna ; Paulus, Michal (advisor) ; Semerák, Vilém (referee)
This thesis investigates the effect of US development aid on US exports to 134 recipient countries over the time period 1993 to 2015 with an application of the gravity model of international trade. Estimates of one-way panel dataset, specified by a dummy approach and estimated with OLS and PPML, suggest that for every aid dollar spent by the United States, US exports significantly increase by 1.59 US dollar. By lagging the aid variable for several years after disbursement, we find a declining effect of US aid on US exports, which indicates that tied aid is an important channel of the effect's magnitude. The effect does not vary systematically across income groups. Yet for geographical regions with a higher US export share, the impact of US aid on US exports is significantly larger suggesting that existing trading relations contribute to a larger effect of aid on donor's exports. The evidence shows that US aid increases US exports and reinforces economic relations with recipient countries and, thus, can be regarded as an important motive for the donor to provide development aid.
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China's One Belt and One Road Initiative and its potential for the tourism industries in Africa, Asia and Europe: a gravity model approach
Jannaschk-Schmitz, Patrick ; Paulus, Michal (advisor) ; Benáček, Vladimír (referee)
In 2013, China presented the idea of the infrastructure project One Belt One Road. The thesis aims to analyse the potential effects of the initiative, and how its attempt to improve transport infrastructure will impact EU-tourist flows to participating countries. A closer look to the effects on the tourism industry is justified because of the importance of the touristic sector for the global economy. For instance, the direct contribution of the touristic sector accounted for 2.3 trillion USD worldwide in 2016. A gravity model approach is used in the following paper to examine the significance of road, railway, air service as well as port infrastructure for tourists from the European Union. Afterwards, an OBOR simulation is carried out that forecasts a potential change for EU-tourist inflows. The results go in line with previous gravity model studies regarding the positive relationship of the GDP and the inverse influence of the distance on tourism flows. Furthermore, the findings suggest a significant impact of well-developed road, railway and air service networks. However, the quality of ports did not meet the expectations and is somewhat contra productive for the decision making of EU tourists. The simulation for the improvement of transport infrastructure implies that countries with an under-...
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The financial instability hypothesis of Hyman P. Minsky and its apllication to the current financial crisis
Paulus, Michal ; Mertlík, Pavel (advisor) ; Skuhrovec, Jiří (referee)
This bachelor thesis deals with the financial instability hypothesis of Hyman P. Minsky and its application to the current financial crisis. The first part of the thesis summarizes the hypothesis, and it mentions works elaborating the hypothesis. The second part of the bachelor thesis applies the hypothesis to the current financial crisis. The whole thesis refers to the general discussion about relations of the Minsky's hypothesis to the current financial crisis and to the fall of the insurance company AIG Corporation. The second part concludes that many relevant parts of Minsky's hypothesis can be applied to the recent financial crisis but important differences of the current financial system to the system in Minsky's times should be awared of. There are two most important differences: changes in risk management and new financial instruments. At the end, the thesis discusses the implications of these differences for applicability of the hypothesis on the current financial crisis. The thesis regards the fact that the recent financial crisis is caused by rational behaviour of economic agents and not by exogenous forces as the most important lesson to learn from the financial instability hypothesis of Hyman P. Minsky.
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The VAT lottery as a charitable lottery
Horváthová, Veronika ; Gregor, Martin (advisor) ; Paulus, Michal (referee)
This thesis consists of two main parts. At first, VAT lotteries are modelled as charitable lotteries for a public good. For that purpose, an economy consisting of risk-neutral, utility maximizing consumers with quasi-linear preferences is assumed. It is shown that the Taiwanese and the Slovakian versions of the VAT lottery provide more of the public good than an economy with no such lottery. The second part analyzes the willingness of firms and consumers to cheat and keep part of the VAT revenue for themselves. This is done because the key difference between the VAT and the charitable lotteries is the existence of firms which have an incentive to cheat and collude with the customers at the expense of the tax office. So when a set of profit maximizing firms is added to the model and the presence of the VAT lottery is still assumed, it is shown that under certain circumstances it might be more profitable for firms and customers to cheat because higher levels of profit or utility, respectively, might be achieved. JEL Classification H25, H41, D62, H26 Keywords VAT, charitable lottery, public good, VAT eva- sion Author's e-mail 58516185@fsv.cuni.cz Supervisor's e-mail martin.gregor@fsv.cuni.cz
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