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In the past decade, we have witnessed how different sets of events can trigger global economic changes. From the aftermath of the 2008 financial crisis to today’s increasing number of political and conflict-related shocks, no nation’s economy has proven resistant to these changes. The complexity of interactions between economic and political factors has increased and these elements ought to be incorporated into future policies.
A new development agenda should carry forward the spirit of active response to changes, seeking an answer to the questions of what should and can be done to anticipate changes and transform economies for the better. Practical focus of the Conference is highlighting the agenda of challenges, topics of migrations, national security, poverty, education, economic growth and healthcare to fulfil our vision of promoting sustainable development worldwide.
The Adriatic Economic Association became a member of the Global Labor Organization, an international network and virtual platform for researchers, policy makers, practitioners and the general public interested in scientific research and its policy and societal implications on global labor markets, demographic challenges and human resources. The GLO Network currently consists of 419 individuals and 20 organizations covering 81 countries. AEA is proud to be one of them.
The GLO aims to establish itself as the world’s leading and global research and policy network on labor, demographics and human resources.
Here’s the abstract:
When companies are faced with an upcoming and expected economic shock some of them tend to react better than others. They adapt by initiating investments thus successfully weathering the storm, while others, even though they possess the same information set, fail to adopt the same business strategy and eventually succumb to the crisis. We use a unique setting of the recent financial crisis in Croatia as an exogenous shock that hit the country with a time lag, allowing the domestic firms to adapt. We perform a survival analysis on the entire population of 144,000 firms in Croatia during the period from 2003 to 2015, and test whether investment prior to the anticipated shock makes firms more likely to survive the recession. We find that small and micro firms, which decided to invest, had between 60 and 70% higher survival rates than similar firms that chose not to invest. This claim is supported by both non-parametric and parametric tests in the survival analysis. From a normative perspective this finding could be important in mitigating the negative effects on aggregate demand during strong recessionary periods.
The Adriatic Economic Association is proud to announce their first paper being published at the multidisciplinary journal PLOS ONE (IF=3.54).
It was a joint collaboration between three AEA members that has led to this publication.
The full citation is Podobnik B, Vukovic V, Stanley HE (2015) “Does the Wage Gap between Private and Public Sectors Encourage Political Corruption?” PLoS ONE 10(10): e0141211. doi:10.1371/journal.pone.0141211
The paper is primarily a theoretical one focused on designing a model of corruption networks in democracies. The intuition for the model was a growing disparity between public sector and private sector wages and how this corresponds with greater corruption. This is, naturally, only a correlation, but it served as a motivation to search deeper and uncover how corrupt networks can sustain themselves within a democratic environment.There were three main findings/contributions in the paper:
The greater the public sector wage premium (higher public sector wages than private sector wages) in a given country, the greater the possibility of corruption
We design and propose a new reward-to-risk ratio for labor economics (taking into account the relative riskiness of working in each sector)
Democracy does not create corruption, but it can serve as a mechanism to preserve it in the long run. A transition from a corrupt to a non-corrupt state, and vice-versa, can only be purely random.