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The aim of this paper is to point out the limitations of conventional approaches, articulated via political processes, in reducing income inequality. Using the panel data methods, on the sample of 21 affluent OECD countries in the period from 1980 to 2011, it is observed that the increase in labour productivity as well as preferences of voters to parties that advocate greater redistribution, contrary to common perception, not necessarily lead to reduction in income inequality. Increasing dominance of big capital in the field of technological progress changes the conventions about contribution of workers to labour productivity. The result is a weakening of workers’ bargaining power in relation to employers as well as increase in gap between labour productivity growth and real wage growth, which both lead to increase in income inequality. In comparison with the other political parties, it seems that the right-wing parties are more efficient in using voters’ support to implement their concept of the welfare state, which contributes to maintaining the high market-generated income inequality. Such situation could be explained that de jure power of the government depends on election results, whereas de facto power depends on the support of so-called globally-oriented super elites. [Projekat Ministarstva nauke Republike Srbije, br. 47010]

This paper focuses on empirical analysis of the Serbian functional food market and its comparison with those in other Western Balkan countries (WBC). The purpose is to examine whether the existence of regulation, as an institutional precondition, makes a difference on the operating of the functional food market. This market is a new, fast developing segment, based on health claims made for food. Consumers in Serbia cannot verify health claims either before or after the purchase/consumption, since the property rights on information are extremely weak. Additionally, with successful innovation the free-rider problem usually occurs. Thus, strong institutional support is necessary to ensure regular market functioning. In order to identify the effects of regulation and some other factors with crucial influence on the differences between Serbian and other WBC functional food markets, pooled cross sectional analysis is conducted. The fixed-group effects model is estimated based on data of product categories observed across WBC. Differences in the current level of WBC market development could be explained by the existence of legal regulation, competition, and other factors. All results implicate the necessity of regulatory supervision as well as closer cooperation between government, the private sector, consumer groups, academics, and the research community in further functional food market development in Serbia.

This paper examines driving forces of economic growth in the second transition decade, by testing which determinants from the first decade remain dominant, and which new factors appear in explaining growth. To this end a panel simultaneous equation model is estimated based on a sample of 27 transition countries in the period 1999- 2009. According to the main findings of the paper initial conditions do not play a role in determining economic growth in the second decade, but macroeconomic stabilization and structural reforms still matter. However, in contrast to the first decade, the overall impact of structural reforms is not positive, indicating that difficult progress with reforms in the second decade could slow down economic growth. Moreover, EU membership seems to have the additional effect of slowing down the growth of the accessing countries, meaning that once a transition country becomes an EU member it has a similar growth path to other EU countries in terms of lower growth rates. All this indicates that only countries that undertook fast reforms in the early phase of transition experienced significant benefits from reforms, achieving higher levels of economic development and becoming closer to developed EU countries. Finally, investments and openness of the economy appear as new important determinants of growth.

The aim of this paper is to present main findings obtained from the empirical analysis of the functional food market in Serbia. The analysis is based on the in-depth interviews with relevant processors and retailers present on the market. The following set of topics are considered: (1) motivations (driving forces) and barriers to offer products with nutrition and health (N&H) claim and (2) perception of consumer demand toward N&H claimed products. Differences between Serbia and other Western Balkan Countries (WBC) are explored by using nonparametric techniques based on the independent samples. Results support overall conclusion that this market segment in Serbia is underdeveloped and rather producer than consumer driven compared to more developed WBC markets.