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Although the movement of people from rural to urban areas has caused the increased use of energy, the abundance of water resources can be made into a form of renewable energy known as hydroelectricity. As European countries are ranked as the first users and exporters of hydropower, the production of renewable energy in developed countries such as the Nordic region has caused great impacts on economic growth and human development. The importance of this paper is to investigate the relationship between hydroelectricity and the Human Development Index by depending on some variables such as urbanization, rule of law, corruption, trade openness, and GDP per capita from 2002 to 2021 in Nordic countries. The results were estimated depending on impulse response function after conducting the Vector autoregressive model (VAR) model and Granger causality test. Results showed a negative impact from hydro plants in the short run but a significant positive impact in the long run in Nordic countries. The long-term sustainment of Human Development Index (HDI) is due to policies limiting the immigration of labor as well as protection of energy use. Water batteries are gaining popularity across Europe and their implementation is near mandatory. [ABSTRACT FROM AUTHOR]

Monetary policy represents one of the most important policies of each country's policy mix. Understanding how monetary policy works and affects real economy is essential in understanding how changes in the settings of monetary instruments such as interest rate increase or decrease will affect the real economy and which variables will react. In this paper we analyse the implications of monetary policy shocks in countries of monetary union in Europe. The focus is on the estimation of the response of economic variables such as a gross domestic product, exchange rate and price level. The model used is based on the vector autoregression approach that enables to estimate the extent and the persistence of monetary policy shocks for tested variables in case of selected European economies. [ABSTRACT FROM AUTHOR]

This paper implements a spatial vector autoregressive model that takes into account both the time and the spatial dimensions of economic shocks. We apply this framework to analyze the propagation through space and time of macroeconomic (inflation, output gap and interest rate) shocks in Europe. The empirical analysis identifies an economically and statistically significant spatial component in the transmission of macroeconomic shocks in Europe. [ABSTRACT FROM AUTHOR]

Exchange rate plays an important role in transmitting pressures from the external shocks to the domestic economy. Development of inflation in the domestic economy is significantly determined by the ability of exchange rate to transmit external price related pressures to the domestic market. Considering the new EU member countries obligation to adopt euro the loss of the monetary sovereignty should be analyzed not only in the view of the direct positive and negative effects of this decision but also in the view of many indirect effects. While the exchange rates of majority of the EMU candidate countries are strongly affected by the euro exchange rate on the international markets there is still room for them to float partially reflecting changes in the national economic development. Ability of the exchange rate to transfer external shocks to the national economy remains one of the most discussed areas relating to the current stage of the monetary integration process in the European single market. In the paper we analyze the ability of the exchange rate to weaken or eventually to strengthen the transmission of the external inflation pressures to the national economy in the Czech Republic, Hungary, Poland and the Slovak republic. In order to meet this objective we estimate a vector autoregression (VAR) model correctly identified by the Cholesky decomposition of innovations that allows us to identify structural shocks hitting the model. Variance decomposition and impulse-response functions are computed in order to estimate the exchange rate pass-through from the foreign prices of import to the domestic consumer price indexes in the Visegrad countries. Ordering of the endogenous variables in the model is also considered allowing us to check the robustness of the empirical results. [ABSTRACT FROM AUTHOR]

This paper examines the monetary transmission mechanism in six EU member states. It provides useful empirical evidence for assessing the impact of a common monetary policy in the early stages of EMU, and enables us to form a view on how the regime change represented by EMU is likely to be translated into changes in policy multipliers in the various EU countries. The empirical analysis applies techniques recently developed by Wickens and Motto (2001) for identifying shocks by estimating a VECM for the endogenous variables, and a stationary VAR in first differences for the exogenous variables. Our findings suggest that there are significant differences between EU countries in the transmission mechanism of monetary policy. [ABSTRACT FROM AUTHOR]

With persistence in macroeconomic variables two aspects of exchange rate credibility emerge whose relative importance varies over time. Both aspects have opposite implications for the relation between fundamentals and credibility. Hence, the effect of policy measures on interest rate differentials becomes ambiguous. In this paper a Markov-switching VAR that allows for parameter shifts across regimes is employed to test the hypothesis of regime-dependent determination of credibility for major EMS currencies. Regime-dependent impulse response functions reveal substantial differences in the response of spreads to macroeconomic shocks across regimes. [ABSTRACT FROM AUTHOR]

This paper extends the studies published to date by performing an analysis of the causal relationships between sovereign CDS spreads and the estimated conditional volatility of stock indices. This estimation is performed using a vector autoregressive model (VAR) and dynamically applying the Granger causality test. The conditional volatility of the stock market has been obtained through various univariate GARCH models. This methodology allows us to study the information transmissions, both unidirectional and bidirectional, that occur between CDS spreads and stock volatility between 2004 and 2020. We conclude that CDS spread returns cause (in the Granger sense) conditional stock volatility, mainly in Europe and during the sovereign debt crisis. This transmission dynamic breaks down during the COVID-19 period, where there are high bidirectional relationships between the two markets. [ABSTRACT FROM AUTHOR]