Small Firms and Economic Transformation in Bulgaria

The pace of transition to a market economy has been slower in Bulgaria than in some other east European countries in the 1990s. Output levels in the state owned sector, which has not yet been subject to mass privatisation, have fallen sharply and there has been a dramatic increase in unemployment. There has however also been a rapid growth in the number of small firms, and the ability of this sector to generate new jobs will be an important component of labour market dynamics in the future. Some of the main characteristics of this emergent sector are identified on the basis of a sample survey of nearly 400 small Bulgarian firms, covering competitiveness, entrepreneurship, innovation, networking, labour relations and business performance of the small firms. Key features of a subset of small firms with an orientation towards employment growth are identified.     

Identifying the Transition from Efficient-Market to Herding Behavior: Using a Method from Econophysics

We test whether “detrended fluctuation analysis” (DFA)—an econophysics method—identifies the transition from efficient-market trading to herding behavior and the rise of the NASDAQ dot.com stock market bubble. DFA divides a time series into “segments” of varying lengths and then tests whether power-law distributions exist within the segments. A power-law distribution of stock-price changes within a segment indicates herding behavior and the start of the dot.com bubble. The clarity of the transition indication depends on both segment lengths and segment starting dates. Our findings show that DFA can be used to identify the beginning of stock-market bubbles but not the beginning of crashes.     

Internal Market Efficiency,Market Co-movement,and Cross-Market Efficiency: The Case of Hong Kong and Shanghai Stock Markets

We examine the effects of the 2008 financial crisis on the cross-market efficiency of the Hong Kong and Shanghai stock markets. Our results show a sharp decline in the cross-market efficiency during the financial crisis. We investigate whether this is due to lower internal market efficiency or higher market co-movement. The results show no evidence that the internal market efficiency dropped in Hong Kong or Shanghai during the crisis. In contrast, we document a strong increase in the market co-movement during the crisis. These results suggest that the decline in cross-market efficiency during the financial crisis is due to increased market co-movement and not a decline in internal market efficiency.     

Building the Ethical Infrastructure of the Market in Post–Communist Countries: The Case of Bulgaria

This study considers major problems involved in seeking to build a post–communist ethical infrastructure for business transactions in Bulgaria. After an analysis of the basic economic and political realities of the present transition period, some recent empirical findings are presented concerning the emerging ethics and business culture, concluding with practical recommendations for the future. The author is Senior Research Associate and she also teaches the Social and Business Dimensions of Business in the Institute of Economics of the Bulgarian Academy of Sciences, 3, Aksakov Str., 1040 Sofia, Bulgaria; e–mail; ineco@bgearn.acad.bg.     

BULGARIA'S NATIONAL INCOME AND ECONOMIC GROWTH, 1913–45

The article concerns Bulgarian statisticians' work on accounting of national income within the first half of the 20th century. Basic concepts of these authors are described, and aggregate data sets derived by them presented. The trend of economic growth in Bulgaria is analyzed, mainly from 1924 to 1945. The statistics of industrial and agricultural change, as well as the foreign trade activity are considered. An historical interpretation of that change is given.