Electronic Library of Scientific Literature
Electronic Library of Scientific Literature
Volume 46 / No. 1 / 1998
Ivan OKÁLI - Herta GABRIELOVÁ - Egon HLAVATÝ - Karol MORVAY - Richard OUTRATA
GDP growth rate in the Slovak Republic in 1997, in comparison with other
transforming countries (and also with OECD countries), enjoyed an above-average
dynamic. In maintaining its high growth tempo, the continuing increase
in performance in the service sector and increases in building deserve
the credit. The fall in material product branches in comparison with their
pre-transformation levels was to a large extent offset by the service sector
growth.
The gradual overcoming of production declines tied to the transformation
process is primarily the result of the rise in productivity of labour.
The pre-transformation level of the economy as a whole, and in the majority
of its branches, was achieved as early as l995. In l997, this level was
significantly exceeded not only in services, but also in industry, and
primarily in agriculture.
GDP growth in l997 (on the basis of data from the 1st to 3rd quarters)
showed a l0.3% rate in gross production, in intermediate consumption, 10.9%,
and a VAT income rise of 9.2%. In 1997 and l996, first three quarters,
one unit of added value equalled l.77 and l.75 respectively of intermediate
production, but in 1995, only l.63 units. In economically developed economies,
the value of the above indicators hovers around one.
A characteristic feature of the branch structure development of the GDP
is the decline over the past two years of the share of industry, from 32.2%
in l995 to 30.0% in l996 and 28.2% a year later. The strong gains in industrial
production continued in l997 only in the branches of cellulose and paper
production, publishing and the press, in the manufacture of electric and
optic equipment, and in transportation manufacture. A certain overcoming
of the negative tendencies of l996 was evident in the production of oil
products and metals and metal products. In all light manufacturing divisions,
there was a decline in 1997, most sharply in leather finishing.
The finishing industry, as the most significant industry in terms of the
export performance of the economy, has come to a certain intermediate stage,
in which production growth has slowed due to some unresolved problems from
the transformation recession, in addition to certain insufficiently resolved
typical development-restructuring tasks. This is largely connected with
the fact that the Slovak economy has for quite a time undervalued the positive
contribution of direct foreign investment in the structural adaption process
(more strongly accented in the recent period). Incidentally, in those industrial
corporations in international private ownership (a l6% share in the industrial
total) production grew by 66.0% in l997, with labour productivity up 52.9%.
Construction production showed for the first time in 1997 a marked increase
(8.6%). Perhaps the most noteworthy aspect is that this rise resulted almost
exclusively from an increase in the productivity of labour, which was accompanied
by a significant real rise in value added (l8.1%). The increase was foremost
in domestic building production, whose 12.4% offset a more than one-quarter
fall in production abroad.
The agriculture situation stabilized in l997 at the level of the preceding
two years, contributed to by advances in the price of agricultural products
as opposed to that of industrial goods, by the good l997 grain harvest
and by a l.7 bill. SKK increase in subsidies from the national budget.
The private sector share in the make-up of the gross domestic product grew
by 5 points over the year before to 82.4%, the private share in agriculture
rising to 93.5%, industry 72.7%, construction, 81.6% and trade and services,
95.6%
The situation on the labour market is connected to the development of the
economic achievement. In contrast with the two previous years, which saw
employment increasing, 1997 was a year of decline. This trend in overall
employment resulted in a lower employment rate in the secondary sector
(mostly in finishing industries) and a significant slowing of the rate
in the third sector (stagnation in shopping, hotels and restaurants, repairs).
After a reduction from 1994's 14.6% unemployment rate, last year saw a
slight rise to 13.0%.
The roughly equal GDP growth rate (6.5%) in 1997 came from a very different
demand structure. Domestic demand increased by 20.6% in the first three
quarters of 1996, but by only 4.6% in the same period a year later, accounting
for 100% of the total final demand in the former period, only 45% in the
latter. The remaining 55% of total demand was made up by external demand.
Along with stagnation of state demand and drop in demand in the creation
of reserves, the 1997 growth in domestic demand rested on households and
primarily demand connected with the creation of gross fixed capital. Four-fifths
of the makeup of this capital was financed from national gross savings
over this period, with the remaining fifth coming from foreign borrowings.
From this it follows that a significant part of 1996 and 1997 GDP growth
did not originate from the strength of the Slovak economy.
The crossing of the development possibilities given by gross national savings
in the SR could also have in 1997 quickened the tempo of economic growth
only by further destabilization of the external and overall economic balances.
Selected characteristics of internal and external equilibrium
Relation of the current account to GDP in %
Relation of hard-currency reserves to average monthly imports
Relation of the state budget account to GDP in %
Consumer price index
GDP deflator
Relation between labour productivity index and real wages in the national
economy
The positive evaluation of developments in the Slovak economy which
information on its performance leads to are to a high degree made problematic
by the data in table 1. The marked signs of inbalance (particularly the
passive account of the foreign trade balance and the current account, together
with the unfavourable results of the national budget) which began to appear
in 1996 were reproduced in 1997 to an equal level.
The significant external inbalance continued in l997 despite the fact that
SR foreign trade had an overall healthier development than 1996, which
led to a bettering of the current account payment balance. This development
rose by 9.2% in 1997, i. e. 3.1 percent points higher than in 1996, in
reality roughly by 4% (by 2% in 1996). On the other hand, import growth
represented only 2.8% in current prices, substantially less than a year
earlier (30.7%). As regards the increase of inflation and import prices
(greater than the rise in export prices), it is estimated that import in
l997 really meant a fall of about l.8%.
The quickening of the dynamic of export as against l996 was to a decisive
degree influenced by the positive enlivening of the situation in western
Europe and the consequent rise in external demand from those countries,
especially for goods destined for manufacturing consumption.
The overall lessening of the import dynamic in Slovakia was influenced
by government regulations for the protection of the domestic market in
the first half of 1997. After their implementation, the rising trend of
imports was pressed to a lower level. However the growth of imports continued
in the 4th quarter of the year.
The dampening of exports, although on the one hand positively influencing
the trade balance and creating a certain space for domestic production
on the home market, was nonetheless a signal of an export performance incapable
of meeting the flow of imports. Similarly, interfering with the import
of modern technology as part of the investment process had its effect on
the increase of labour productivity and future competitiveness.
As regards the foreign trade orientation in 1997, European Union countries
again strengthened their position (42% of total), with the growth in those
markets accounting for 94% of the year's total. The positive trends of
1996 in the goods structure of exports continued in 1997. Concretely, the
share of goods primarily destined for manufacturing consumption characterized
by a relatively lower degree of finishing fell, with a lower added value
and higher quality of raw materials and energy. Conversely, the amount
of machinery and vehicles rose.
The overall development of the payment balance showed that the dynamic
of foreign capital does not meet the needs arising from the economic restructuring,
and lags in comparison with neighbouring transforming countries.
The actual state revenues surpassed budget estimates (5.7%) to the same
extent as expenditures overran their predictions. Therefore, the deficit
essentially matched its planned level with the overall financial picture
fulfilling budget expectations. In spite of this, they were, from several
viewpoints, problematic.
Chief among these problems was the increasing deficit in 1997. The ratio
of the deficit to the GDP has been increasing since 1995 (see table 1).
The achieving of the planned budget deficit allowed the transfer of the
settlement of some material expenses from the year to the following period,
to the amount of 4 bill. SKK. Including these, the ratio would have stood
at 6.4%.
A second, hidden, but nonetheless serious problem was the significant breakdown
in the structure of accomplishing both revenues and expenses. On the income
side, a low fulfilment of tax yields was due primarily to the insufficient
(58%) take from the income of legal subjects. This was partially offset
by a surplus in expected revenues from physical persons and in particular
by income from the newly imposed import tax. On the expenditures side,
the country solved the tension by the restrictions of current expenses.
This however substituted for only the lesser part of its greatly overreached
capital expenses.
The currency policy of the National Bank of Slovakia tried in 1997 to eliminate
internal and external threats to its overall equilibrium. A relatively
stable SKK exchange rate was also ensured by the inflation rate, which
led to a further realistic valuation of the crown. The M2 currency aggregate
grew more slowly than in the previous year. The expansive growth of expenditures
in the government sector was neutralized by a slowing of the increase of
bank credits to the enterprising sector.
The stabilizing regulations of the NBS did lead to a freezing of liquidity
on the currency market, but also put into motion the interest rates of
commercial banks. This was shown not only in the restricted dimension of
loans, but also in the growth of expenses of debt servicing of the national
budget. Through the increase in enterprises' financial expenses, the increase
in the credit rate affected the development of prices. The inflation rate
measured through the increase in consumer prices (and influenced only to
a minor extent by state price regulation decrees) went up slightly from
1996's 5.8% to 6.1%.
Foreign indebtedness maintained a sensitive place in the monetary policy.
Total gross foreign debt grew in the first eleven months of 1997 from 7.81
bill. USD to 10.72, a 37.2% rise. This was composed of a slight rise in
official government debt, but primarily that of the business sector, by
46.5% or 2.77 bill. USD.
Predictions of economic development in 1998 start from the fact that in
the SR's chief trade partners a positive prosperity reigns, and within
a slightly restricted domestic demand, the growth tempo of investment demand
has lessened. In the case of these conditions being realized, the GDP rate
of increase, even with continued usage of foreign credit resources, will
be lower than in 1997, within the 4-5% range. It is probable that economic
growth will also in 1998 result from market services and construction.
If the weather cooperates, it can be expected that there will be a l-2%
growth in agricultural production. The growth rate in industrial production
should be one point higher than in 1997.
In the presence of achievement of the expected tempo of economic growth
and fulfilment of the national economic policy and the NBS monetary policy,
it is possible to expect that the average yearly increase in consumer prices
should be from 7.5-8.5%, and the mean level of unemployment stand at 13.5%.
The actual state revenues and expenses. On the income side, a low fulfilment
of tax yields was due primarily to the insufficient the economic restructuring,
and lags in comparison with neighbouring transforming countries.
Anna REMIŠOVÁ
The rise and development of business ethics has been and is a reaction
to the partial implantation of economic rationalism, understood as pure
economic rationality without ethical norms. If economic activity is aimed
exclusively at the maximalization of profit, if it fails to take into consideration
its effect on the person, society and nature, it leads to such consequences
as the denial of basic human rights, corruption, paternalism, the undignified
wretchedness of millions of people, moral schizophrenia, the devastation
of nature and the like.
The relation between economic and ethical rationality, between profit and
ethics, is the fundamental issue of business ethics. The essence of the
conflict between these two rationalities lies in the dualism between the
world of economics and that of morality.
The modernistic dualistic paradigm comes from the politico-economic theory
of Adam Smith, differences which are continued in neoclassic economics.
It can be generally claimed that neoclassic theory regards economico-technological
rationalism as the complete opinion. The theoretic starting point of neoclassic
economics is methodological individualism, which deals with the neoclassical
model of man - homo oeconomicus.
Neoclassical economic theory and the utilitarian ethos are the basis of
the neoclassic paradigm, in which utility, the maximization of usefulness,
or in economic terms, the maximization of profit, appears as the basic
goal.
Even though the modernist dualism of ethics and economics had its theoretic
and practical bases in its own period, they have not prevailed up to the
present (Etzioni). The need to integrate ethics and economics follows from
the character of the thing, i.e. from the common interest in rational and
optimal coordination. Human activity has many forms, it is the coordination
of a number of styles, but always of the activity of rational and purpose-oriented
beings. One can neither live without economics nor without morality. What
will be the quality of that morality, what is judged to be the criterion
of moral behaviour, is another issue.
Theoretic and practical problems arise on how to link these two ways of
coordination, if economic coordination is a coordination brought about
by individual interest and ethical coordination on the basis of common
interest. The integrating factor of both forms of human activity coordination
is business ethics, uniting strategic and practical rationality. That is
why business ethics is also referred to as the integrating scientific discipline
(Ulrich). The subject of investigation is therefore the conflict between
economic and ethical rationality.
The concept of economic rationalism should today be widened to all levels
of conduct on the principle of ethics (individual, institutional and societal).
Alongside the criteria of profit, growth, performance, productivity and
the like, alongside, that is, qualitative criteria, the new contents of
rationality should also include criteria of ethical and social responsibility
and consideration of the expected results of conduct on the individual,
on the society and on the environment.
A new understanding of economic rationality in the sense of the new social
paradigm, an element of which is the rise and development of business ethics,
should be focused on two fundamental problems.
In the first place, it should spring, more than up to the present, from
the function of economic activity in society. It should be more strongly
accentuated that economics brings about the satisfaction of human needs,
aids in the creation of the societal good. Its primary mission is therefore
to serve life, to meet human needs and desires, to preserve the human race.
Secondly, it will become essential to give a direct, clear answer to the
principal issue in changing the contents of the concept of economic rationality
- what should be the relation between ethical principles and profit, where
does primacy on all levels belong in the interaction of economics and ethics.
These are the central issues of business ethics, to which there are no
clear-cut answers. The author of this contribution leans towards the viewpoint
of those theoreticians who propose a preference for ethics over profit,
so that this profit may be used for the removal of scarcity, disease, other
people's tragedy, and the devastation of nature.
Ladislav ANDRÁŠIK
In an essay published in EC/EJ 1/97 named Animated Economy the author
set down and was alight his basic theoretical conception of the process
of "learning by evolution in an artificial economy". The present
contribution is, on the one hand, a simulation supplement to his former
essay and a further non-conventional explanation of the simulation of artificial
economic system problems on the other. He focused the attention of readers
first of all to one interesting problem among others, the problem of an
economy transition form the state of command economy to some type of market
economy paradigm. He noted that his approach is only one among other possible
approaches based on an artificial economy similar to that used in his former
essay and to that some more broad on-conventional economic simulation problems
in the contributions of several authors on simulation of artificial economic
systems.
The matter of the present essay is the creation of condensation cores of
an infant market economy "mired" in command economy for visualization
of the evolution of ontogenesis of particular condensation cores (or germs).
Each of these cores evolves independently from the evolution of the others,
on the base of the command economy. Their rising is realized by the immigration
of agents from the command economy. There also is the possibility of immigration
of capital from abroad (in several forms of foreign capital, e. g. FDI).
The whole artificial economy as in the former case consists of two parts.
The first of them is the simulation model of the artificial learning agent.
The second part is to the reader familiar neoclassical model accommodated
for using as a hidden economy. This supplement is it necessary to read
on the base of former (preliminary) essay [p. 2].
In the preliminary part of the introduction, the author puts stress on
the common knowledge that or world consists of many diverse complex systems,
ranging from individual living organisms such as the carnivorous, to ecosystems
such as the savannah or a community of national economies as the European
Union. Metaphorically speaking, the European Union is also a particular
ecosystem like the rain forest or savannah. Despite their variety, complex
systems like a cluster of economies have many structural shapes and functional
features in common that can be effectively simulated using artificial living
systems. The author is emphasising that this ability to model evolutionary
systems is already having a powerful influence on analysing complexities
in economic processes. It is evident, even on first sight, that processes
in transitional economies belong to the class of those which are very complex.
The author writes in the first part of the introduction that phenomena,
cases, episodes and stories in societies in transition belong among the
most interesting fields of contemporary economic research if not in present
day social science as a whole. under question is however, if mainstream
economics is prepared completely to solve those topics, because at its
methodological shortcomings and inadequacies (or because it has been preparing
for a long period for solving other phenomena). The author's opinion is
that that those are more appropriate to solve the traditional problems
of "capitalist" market economies. Unfortunately the differences
between civilised market economies and post-communist countries are extremely
large, so the author adopted the procedures and techniques of neo-classicism
with a high degree of caution.
The author on the other hand believes that because of the slowness of transitional
processes, in terms of evolutionism, the economic events of societies in
transition belong to the class of scientific subjects which should be accelerated
to receive analysis of their true nature. It is obvious that in a naturally
objective world such analyses is beyond imagination.
By the assistance of distinguished simulation models run in contemporary
PCs, one can bring far future events to present time. It is apparent that
the outcomes of such episodes aren't independent form the interval of time
from the present instant to a future one. In other words they are the consequence
of an evolutionary process, (which contain a lot of bifurcation points
- in those points a great set of subjects decide among particular varieties
of events and/or alternative possibilities).
The author points out that the above revealed character of the subject
is not a simple fable such as path dependency. For example, he sets down
that the same subjects in nearly the same situations could be decided independently
in a variety of modes. Naturally, there are huge bags of similar problems
matured to resolution in economics of transitional processes, however.
He accepts that it is out of possibility to deal with them in that contribution.
Obviously he not does mean that it isn't important for the subject.
The author's plan in the present paper has a twofold goal, on one hand
to contribute to movement away from purely mental models of the transition
process in post communist countries, which necessarily lack adequate precision
and on the other, to movement away form purely analytical models too. Third,
the common movement (upon to former, forced by original computer experimentation)
with simulation models is toward more insightful and disciplined simulation
models generally and particularly of formerly communist economies suitable
for computer experiments. Fourth, it must be apparent to readers that this
paper is actually based on previous contributions t the problems of earlier
mentioned experimentations with evolutionary learning in an artificial
economy whose outcomes was not explicitly published in this journal No.
1, 1997 named Animated Economy because of lack of space.
Both papers deal with comparable new streams of economic research the last
few years, namely modelling the learning of a single economic agent on
one hand and a population of economic agents on the other hand. The former
can appear as theoretical and methodological background the for later one.
The latter can be judged, among others, as a supplement to the former.
So even at first sight the character of both papers is not conventional
and/or traditional from several points of view.
More exactly expressed, the above discussed unconventionality linked both
modelling of economic systems and also the modelling of learning behaviour
of rational agents. The author emphasised that in both classes of modelling,
many different models have been proposed, providing interesting insights
into the phenomenon of the evolution of economic systems. For example in
"classical" modelling of dynamic economic systems there are a
vast number of publications with new model paradigms of simulation models
and of computer software. More interesting in view of the present study
is the new class of modelling of the learning behaviour of rational or
bounded rational agents. For example the author expect his models to behave
independently of expectations of his mind or of his will. That is what
he designates the vital model of economic behaviour.
The author's vital models are other objects than creatures in the case
of evolutionary algorithms - (EAs). So he enforced the simulation models
(software creatures) to act as living biological organisms. It is known
that their main objective is the struggle for survival by fitness. The
reader can see that the author is nearer to biology, ecology and ecology
than to the art of EAs. He emphasises that the pilot direction of his methodology
is the struggle of existence, both in the case of single agents and of
society of agents as a whole (and of both entities borough holistically).
that navigator criterion is more important for "good" composition
of and economic system than some consumption function and/or hedonistic
utility functional.
The present essay, e. g. in the narrow explicit sense, is consisted , besides
the introduction and conclusion, of three part. The part numbered as 2.,
and called "Some new directions in the modelling of economic systems"
was submitted by the designation of an anonymous referee who focused the
author's attention an the new publication of H. Dawid named "Adaptive
learning by genetic algorithms". The author agrees with the referee
that Dawid's contribution to the problem is very important in the present
subject. So the author decided to address a little more attention to his
publication and to similar others from the past few years. This is obviously
some digression form the exact subject of the present article. On the other
hand the need of acceptation of the newest literature form this growing
part of economic science is without discussion.
Herbert Dawid intended his findings to contribute to the growing field
of research dealing with the use of AI an CI techniques in economics. The
author shortly summarised some of the most important contributions of his
"Adaptive Learning..." He believes that Dawid is fully logging
in the stream of standard AI and CI techniques applied to analysis of conventional
economic problems. The author discussed with some ambivalence H. Dawid's
arguments on this new field of theorising. On the other hand he is in agreement
with the prevailing part of his findings presented in the above named book.
For example, with such opinion that Gas, due to their decentralised structure,
which very naturally resemble a group of economic agents and their interactions,
is especially well suited to simulate the behaviour of an economic system.
The opposite evaluation he addresses to Dawid's conclusion on another fact,
his statement that in economic set-ups the fitness of single strings depending
on the current state of the whole population has led to the conclusion
that the analytical models which describe the behaviour of a genetic algorithm
used to solve an optimisation problem can not be applied in an economic
system. The author argued that his own simulations showed that conventional
mathematical theories used in economics enable us not only to understand
but also to predict the behaviour of Gas in economic systems.
In part No. 3 "Preliminary reflections on learning in local germ of
market economy embedded in transitional economy" the author introduced
some type of transition process form the so-called command economy to a
market one. In the abstract view such economy consists of two domains.
The one is full of command economy. The other one is empty but open for
immigration of market type economic agents and primary factors (labour,
capital, land), e. g. for creation of a market economy domain. Actually,
the incident process of transition is carried out between two phasic brands
(or phases) of some "nominal" economy. The existing, initial
phase the author names "command economy" The final (target) phase
he calls "market economy".
After the transition process is finished, the domain of the command economy
comes to be empty and the domain of market economy come be filled by "market
economy" content. The author understands this process also as some
process of winnowing (or overdoing) the former economic content of the
first domain through special transformation to second domain. Actually,
in model representation we can such phase transition carrying out by method
of creating area ( domain) of market economy "mired" into original
command economy. At the beginning of the process we handle actually all
the same with the seminal core of future area of market economy.
On the ground of the above preparatory statement the author constructs
the starting content of the market economy domain. He assumes that as a
result of so called restitution there was created some germs of portfolio
content in the market economy domain. These represent the supply in the
market of primary factors of production (land, capital, labour force).
Form the other side of this market, there is a demand of firms for those
factors. The author assumes equilibrium in this market, so he has to suppose
that demand is equal to supply.
For transformation of primary factors to output the author assumes a standard
(conven-tional production function, such as he used in former essay in
this journal (Andrasik, 1997). The outcome of the transformation process
or the output of production is depicted in Table 2.
The proper simulation of tax free zone in former (by central command) manipulated
economy. The author consider three types of animate. All types of animal
we endow with initially vital energy contents (IVEC). This part of the
essay is very illustrative. The author uses several Tables (No. 2 - No.
14) and Pictures (No. 1 - No. 12) for this goal. Actually his proper blueprint
in this part (and in all the essay too) is to illustrate the extremely
complex and confused character of transition processes on the base of their
computer experimentation with non-conventional simulation models.
The author supposes that for the first period of transition the agents
are not capable of learning. In other words, they initially only repeat
their former behaviour. On the other hand, because of better socio-economic
conditions in this domain of economy, it is interesting for other agents
to immigrate from the command economy domain to this market economy one.
For better exhibition of the matter of transformation actions he use a
slightly exaggerated figure - assuming that the dose of immigration is
on the level of former state of owners of labour force.
In the conclusion of the essay the author summarised the outcomes of theorising
in the area of artificial economic systems, and of experimentation on PC
with unconventional simulation models generally and with special attention
to the problems of transition. He also paid some interest to the problems
of use of special programming "technologies". he had in mind
such as genetic algorithms (GA), computational intelligence (CI), genetic
programming (GP), theories of artificial life (TAL) and/or artificial society
(TAS), neural networking (NN) and so on, from the point of view of their
usability for economic science.
The author concludes that form the point of view of older theories based
on traditional mathematical and statistical models, the present economic
theories must overrun the former mostly abstract and rather simple theories
by a more vital concept nearer to real economic life in non-anonymous situations.
In this connection the new approach presented in the last contributions
of the author and in similar ones in the fields of cognitive sciences and
artificial intelligence may come to new achievements. Actually, it is hopeful
to expect some new outcomes also in the qualitative sense.
Serhan CIFTCIOGLU
This document deals with a contemporary issue, the dynamic changes in
exchange rates in small open economies which may take place as a result
of various types of disturbance in a large economy.
The author formulates a discrete model of the interaction between the large
and small economy. The non-traditional signs of the small open economy
used are a delayed reaction (now on the demand side, now on the supply
side) to changes in the relative price of domestic goods and prices in
domestic currency for imported inputs, as well as on the existence of outputs
and the inertia of the price level. The first mark of the model shows that
to a flexible level exists a slowed reaction in relative prices and changes
in the exchange rate as a result of such factors as "removed late
decision-making" and "longer-lasting agreements" connected
to the greater variability of the exchange rate. Models of open economies,
be they large or small, are expressed in discrete time and are used in
research on the short-term effects of the exchange rate (short-term influences
and first periods) on production demand, currency demand, and on interruptions
of the price level touching on the larger economy.
The author also provides simulations to investigate the influences of accepting
a relative accommodation of monetary policy in the large and the small
economy on the short-term instability of the exchange course caused by
any type of disturbance.
The conclusions and implications for economic policy following from the
application of the model can be of interest to peripheral countries, for
instance Turkey, the Slovak Republic, the Czech Republic and Hungary, in
their relations to the European Union. The basic results found by the author
include the following: The influence of the results of the disturbance
on production and monetary demand and on price levels in the large economy
cause devaluation of the currency of the small economy in the impact period.
However, in the following period, without regard to the respective degree
of monetary accommodation in both economies, the nominal exchange rate
is likely to fall following any kind of disturbance. Besides this, the
simulation provided shows that the extent of the "lagged devaluation"
will depend on the respective degree of accommodation in both economies.
Vladimír BALÁŽ
The Japanese capital market stands as a leading world market in terms of market and trade values, strength of underlying economy and volume of available domestic savings. However, the market performance has been poor since the 1990s stock crash. Excessive government fund raising, legislative barriers for involvement of financial institutions in capital market operations, over-regulation of the securities industry and lack of competition on the domestic securities markets have been the main reasons for Japan's lagging behind. In the same time the USA a EEU securities markets got into fierce announced by Mr. Hashimoto's government is to result in deregulation and liberalisation.
Erika KVAPILOVÁ
Unemployment is one of the most discussed topics among economists, social scientists and decision makers world-wide. This paper focuses on theoretical interpretations of causes and a possible cure to unemployment in Europe in the late 1980s and 1990s, and their practical, political consequences. It is suggested that political responses to unemployment have been, apart from some "objective" constraints such as economic recession, globalisation of markets or development of technology, also a reflection of the pwer balance between labour and capital. For decreasing unemployment in Europe while at the same time preserving the living standards of citizens, two things are crucial. a shift of the power balance towards the interests of labour, and at the supranational level, a joint effort to make the fight against unemployment a political priority. In this context the European Union could play an increasingly important role as an arena for creating a common strategy to combat unemployment in Europe.