The education pillar of the Europe 2020 strategy: a convergence analysis

Empirica - In March 2010, the European Commission launched the Europe 2020 strategy ‘for smart, sustainable and inclusive growth’ in the EU. Education is a major pillar of the Europe...     

Fiscal shocks and budget balance persistence in the EU countries from Central and Eastern Europe

This article analyses the time series properties of the fiscal balance in the 10 EU countries from Central and Eastern Europe. The persistence of the fiscal balance is analysed by means of unit root tests that account for possible nonlinearities and structural changes. The linear and nonlinear unit root tests find only mild evidence in favour of the stationarity hypothesis, with asymmetric effects present in a few cases. After controlling for structural changes in the Data Generation Processes (DGPs), the results point to stationarity of the series. Thus, in spite of relatively steady headline figures, the budget balance processes in the EU countries from Central and Eastern Europe exhibit substantial instability.     

Convergence of Inflationary Shocks: Evidence from the Caribbean

In this paper, we aim to shed some light on the inflation dynamics in the Caribbean. We analyse the inflation rates for twelve countries using various time series methods. The results show that the inflation rates are mean reverting processes and that there is evidence of a convergence club in inflation rates within the area, which contradicts previous studies. Our contribution implies a high degree of similarity in the dynamics of our target countries' inflation rates.     

IS THERE AN ASYMMETRIC BEHAVIOUR IN AFRICAN INFLATION? A NON‐LINEAR APPROACH

In this paper we test the inflation persistence hypothesis as well as model the long‐run behaviour of inflation rates in a pool of African countries using a non‐linear framework. In order to do so, we rely on unit root tests applied to non‐linear models and fractional integration. The results show that the hypothesis of inflation persistence does not hold empirically for most of the countries. In addition, the estimated models (logistic smooth transition autoregressions) are stable in the sense that the variable tends to remain in the regime (low inflation or high inflation) once reached, and changes between regimes are only achieved after a shock. The results also indicate that the effects of the shocks on inflation tend to die out; exogenous factors, i.e. supply shocks and inertia may be causing this outcome, as they play a substantial role in the determination of the inflation rates for our selected African countries.     

Economic class and the distribution of income: a time-series analysis of the UK economy, 1955–2010

This paper contributes to our understanding of the determinants and dynamics of surplus-value using quarterly UK data, 1955–2010, and the Johansen (1988 Johansen, S. 1988. Statistical analysis of cointegrated vectors. Journal of Economic Dynamic and Control, 12: 231–54. [Crossref], [Web of Science ®] , [Google Scholar], 1991 Johansen, S. 1991. Estimation and hypothesis of cointegration vectors in Gaussian vector autoregressive models. Econometrica, 59: 1551–80. [Crossref], [Web of Science ®] , [Google Scholar]) cointegration and vector error correction model (VECM). A model is introduced to define this Marxian concept, before we explain distribution, paying attention to three forces that are traditionally seen as drivers of power in this struggle: (i) working class militancy; (ii) the size of the ‘reserve army’ of the unemployed; and (iii) political party. Our results demonstrate the ongoing relevance of Marxian economics in providing an alternative, robust and significant explanation of distribution in the post-war UK economy.     

Further evidence on the PPP analysis of the Australian dollar: Non-linearities, fractional integration and structural changes

The aim of this paper is to analyse the empirical fulfilment of the Purchasing Power Parity (PPP) theory for the Australian dollar. In order to do so we have applied recently developed unit root tests that account for asymmetric adjustment towards the equilibrium [Kapetanios, G., Shin, Y., Snell, A., 2003. “Testing for a unit root in the nonlinear STAR framework”, Journal of Econometrics, 112, 359–379] and fractional integration in the context of structural changes [Robinson, P.M., 1994. “Efficient tests of nonstationary hypotheses”, Journal of the American Statistical Association, 89, 1420–1437; Gil-Alana, L.A., 2008. “Fractional integration and structural breaks at unknown periods of time”, Journal of Time Series Analysis, 29, 163–185]. Although our results point to the rejection of the PPP hypothesis, we find that the degree of persistence of shocks to the Australian dollar decreases after the 1985 currency crisis.     

Fiscal consolidation in Europe: has it worked?

The aim of this article is to shed some light on the issue of fiscal austerity within Europe. We focus specifically on the 2008Q1–2014Q4 period, and on the effect of shocks to government expenditure and taxes on unemployment, controlling for other macro factors. We find that expenditure contractions may be detrimental for employment.     

Inflation convergence in Central and Eastern Europe vs. the Eurozone: Non‐linearities and long memory

In this paper, we consider inflation rate differentials between seven Central and Eastern European Countries (CEECs) and the Eurozone. We test for convergence in the inflation rate differentials, incorporating non‐linearities in the autoregressive parameters, fractional integration with endogenous structural changes, and also consider club convergence analysis for the CEECs over the period 1997 to 2015 based on monthly data. Our empirical findings suggest that the majority of countries experience non‐linearities in the inflation rate differential; however, there is only evidence of a persistent difference in some countries. Complementary to this analysis we apply the Phillips and Sul (2007) test for club convergence and find that there is evidence that most of the CEECs converge to a common steady state.     

Unemployment rate cycles in Europe

This article analyses the duration of cycles in the unemployment rate series in a group of EU countries. It extends the model by Bierens (2001) and follows Gil-Alana (2001) by allowing for fractional cyclical integration. Once cycles are introduced in the model, we have more evidence of mean reversion than in previous studies.     

The Perceptions of Consumers Regarding Online Retailers’ Ethics and Their Relationship with Consumers’ General Internet Expertise and Word of Mouth: A Preliminary Analysis

Ethical concerns of Internet users continue to rise. Accordingly, several scholars have called for systematic empirical research to address these issues. This study examines the conceptualization and measurement of consumers’ perceptions regarding the ethics of online retailers (CPEOR). Also, this research represents a first step into the analysis of the relationship between CPEOR, consumers’ general Internet expertise and reported positive word of mouth (WOM). Results, from a convenience sample of 357 online shoppers, suggest that CPEOR can be operationalized as a second-order construct composed of four dimensions: security, privacy, fulfillment, and non-deception. Our findings also indicate that consumers’ general Internet expertise significantly improves CPEOR and CPEOR are strongly predictive of consumers’ WOM. Managerial and research implications are offered.