Journal of Economics - Obsahy ročníkov

The paper deals with the relationship between provided credit and non-per-forming loans (NPL) in the Czech Republic (CR). In the period 1994 – 2016 the CR experienced both periods of rapid credit growth and the transition to market economy followed by a strong convergence process. The aim of the paper is to investigate the effects of credit growth on the NPL dynamics. The selected method is Bayesian estimation with instrumental variables. Results demonstrate positive relationship between the credit growth and the NPL dynamics; however, estimated posterior mean values are rather small and imply that the credit growth influenced the accumulation of credit risk and the origination of the NPL in a modest way. Moreover, the effects are stronger in the CR compared to the prior value (close to zero), which is calculated based on the information obtained from the international empirical studies. Keywords: Bayesian estimation, credit-to-GDP gap, credit growth, non-performing loans; JEL Classification: G21, C20, E44

In this paper, we examine the extent to which monetary policy might be con-strained by the evolution of government indebtedness. We employ a threshold vector autoregression (TVAR) model to capture the possible asymmetries in the relationship between monetary policy and the real economy, corresponding to a switch between low and high growth rates of the government debt-to-GDP ratio. The analysis is performed on Czech data over the 2001 – 2016 period. Results show that the reaction of a central bank to macroeconomic shocks can be regime-dependent. We find that a rising government debt could constrain monetary policy, which manifests through an altered monetary policy transmission to the real economy. Overall, our study demonstrates the advantages of using a non-linear approach to study the fiscal and monetary policy interactions. Keywords: government debt, monetary policy, policy innovations, threshold VAR; JEL Classification: C32, E42, H63

We apply nonlinear autoregressive distributed lag (NARDL) approach to investigate the relationship between budget deficit and current account deficit in Croatia, Czech Republic, Hungary, Poland, Romania, Slovakia, and Slovenia. Our results indicate that changes in current account deficit have a significant effect on the budget deficit in Poland and Romania in the long-run and Croatia, Poland, Romania and Slovakia in the short-run. On the other hand, changes in budget deficit significantly affect the current account deficit in Czech Republic, Hungary, and Slovakia in the long-run and in Czech Republic, Hungary, Slovakia, and Romania in the short-run. Therefore, we conclude that the twin deficit hypothesis is valid for Czech Republic, Hungary and Slovakia but not for the case of Poland, Croatia, Romania and Slovenia in the long-run. Finally, we also present evidence for the existence of asymmetric effects in this context. Keywords: twin deficit, asymmetry, CEE countries, Ricardian Equivalence; JEL Classification: E60, F32, F40

The design of a tax system should take into account that producers in the national economy are strongly interconnected. Increasing the tax burden not only affects the sector the activities of which taxes are directly levied on, but all other economic entities, too, because of sectoral linkages. In this empirical research, the input-output (I-O) analysis was used to analyse sectoral linkages of taxes within the Croatian economy. The results show that the largest ratio of total to direct tax effects induced by unit change of final demand in an open I-O model (type I tax multiplier) is found in sector CPA_A01 – Products of agriculture, hunting and related services. The largest ratio of total tax effects to direct tax effects per unit change of final demand in a closed I-O model – (type II tax multiplier) is found in sector CPA_T – Services of households as employers; undifferentiated goods and services produced by households for own use. On the other hand, the lowest indicators of type I and II tax multipliers are found in sector CPA_L68A – Imputed rents of owner-occupied dwellings. Keywords: tax multipliers, fiscal policy, input-output analysis, sectoral linkages, Croatian economy; JEL Classification: H23, C67, H2

The aim of the paper is to define the main features of the reverse mortgage, to present the socio-economic situation of seniors in the Slovak Republic, to present the results of a survey aimed at the interest of seniors in using a reverse mortgage and formulating recommendations for application practice. The questionnaire survey was realised nationwide in all regions on a sample of 925 respondents. Of the total number of respondents, only 16% of property owners showed interest in a reverse mortgage. The answers of the respondents showed that the main reason for the lack of interest in the reverse mortgage is the unwillingness to break the intergenerational property transfer, which confirms the traditionally strong family relations and family solidarity in the Slovak Republic. Keywords: Slovak seniors, reverse mortgage, living standards, aging of the population, housing; JEL Classification: G18, G21, J11, K20