Journal of Economics - Obsahy ročníkov

The aim of this paper is to examine the influence of the accession of Slovakia to the European Union and the Euro zone (Euro area) on the efficiency of Slovak banks. We use data envelopment analysis to estimate bank efficiency, and ordinary least squares and tobit regression to estimate influence of possible bank efficiency determinants. Our analysis shows that the bank efficiency increases both after the accession of Slovakia to the European Union and the Euro zone. We find that the adoption of the Euro has positive impact on bank efficiency in the longer run, although it can have short term negative impact. Our results suggest that efficiency of Slovak banks was not affected by macroeconomic conditions and banking reforms, which is in line with the argument that Slovak banking sector is in the advanced stage of development when influence of these factors is of less importance. We also find that large banks are more efficient than small banks, and foreign banks are more efficient than domestic banks. Keywords: Slovak banking sector, cost efficiency, accession to the EU, adoption of the Euro, banking reforms JEL Classification: G21, F33, C14

The aim of the paper is to build a Monetary Conditions Index (MCI) for four Central and Eastern European (CEE) countries by combining changes in the short-term interest rate and in the real effective exchange rate over the period August 2005 – December 2015. Contrary to previous papers, we employ a Vector Error Correction Model to assess the relative importance of real interest rate and real exchange rate for the monetary conditions in several CEE countries. The results of the analysis provide new empirical evidence on the MCI’s ability to capture the monetary policy developments. Furthermore, we employ Granger causality to infer the extent of external influences on the overall monetary conditions of analysed countries. The results highlight that monetary decisions in the Eurozone have a prominent influence on monetary conditions in CEE countries. Keywords: Monetary Conditions Index, Central and Eastern Europe, monetary policy, principal components, Vector Error Correction Model, interest rate, real exchange rate JEL Classification: E52, E44, E17

The present paper uses a two-country overlapping generations framework in order to assess the implications of the degree of fiscal discipline on the fiscal policy effectiveness in a currency union. The results show that, initially, a fiscal stimulus implemented under the condition of returning to a balanced budget leads to a higher increase in per capita output and consumption compared to a fiscal expansion with permanently higher public debt. However, in the medium run, the strict fiscal discipline case leads to an output recession despite the increase in private per capita consumption whereas a loosening of the fiscal discipline helps avoid the recession at the cost of higher public debt. The overlapping-generations framework shows also the demographic impact on the fiscal policy effectiveness under different degrees of fiscal discipline. Keywords: fiscal policy, fiscal discipline, currency union JEL Classification: E62, F41, H62

The paper explores the various typologies of confidence indices and barometers that have been developed by audit and consultancy firms, research centres or banking associations with the purpose to assist banks in better understanding customers’ needs, perceptions and expectations. The study gravitates around the European banking sector, by relying on the customer experience index developments during 2011 – 2015. We follow a twofold statistical approach, meant to investigate whether the index dynamics may be significantly determined by changes in several broad coverage variables, and respectively the presence of a two-way causality between the index and variables included in the sample. The findings obtained are of interest not only for banks, but also for public authorities and financial regulators, as the customers’ confidence index used in the study appears to drive subsequent changes in the level of several macroeconomic, financial and institutional variables. Keywords: customer experience index, confidence, banking system, macroeconomic fundamentals, panel data JEL Classification: C23, G21

We have adopted Rodrik’s “undervaluation” hypothesis to verify the conjecture that innovative firms in Poland opt for a weak currency because they face obstacles in the labour and financial markets. We do it by exploring a new database on Polish manufacturing exporters in order to find some interrelations between the exchange rate level and innovation activity. Our findings suggest that a weak Zloty is preferred by exporting firms that have carried out product and process innovations and registered a trademark, patent or claimed a copyright. We confirmed that financial constraints and labour market regulations were important factors preventing the growth of innovative firms. Based on the research on Polish firms, we claim that although innovative companies use technology to gain competitive advantage, their success and innovation activity also hinge on prices in general and on a weak exchange rate in particular because it helps to overcome market imperfections related to financial and labour resources. Keywords: exchange rate, innovation, firm, growth JEL Classification: F43, O31