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This study explores the specifics of strengthening Central Asian regional cooperation and its potential opportunities according to Hungary’s Eastern Opening Policy.

International financial reporting standards (IFRS) have become a worldwide common accounting language which most countries have adopted. However, there are no studies obtained based on transition economies in a particular geographic zone. Thus, this study is carried out to observe the influence of IFRS adoptation on the economic growth of 11 CIS countries from 2005 to 2018. To examine the actual effect of the variables, the regression model was divided into two sub-models based on the category of variables. There is a difference between the economic growth in adopted and non-adopted states. The adoption of IFRS showed negative and insignificant relation to GDP per capita. The number of observations after fully adopting IFRS was low, the data on IFRS adoption was challenging, and an advanced econometric model should be selected. The study compared CIS results with Eastern European countries to see a clear pattern and generate an efficient suggestion for policy implementation. The policy implementations related to Uzbeki-stan were also provided.

Central and Eastern European (CEE) countries are struggling with internal and external macroeconomic and social factors in their catching-up strategies to be closer, as economic wealth, to the Western developed European countries. In these ex-communist countries, institutional factors could be seen as critical for success in narrowing the income gap. The paper proposes an analysis of the impact of economic and financial development and globalization on the income gap in 11 Central and Eastern European (CEE) countries (Bulgaria, Croatia, Czechia, Estonia, Latvia, Lithuania, Poland, Romania, Slovak Republic and Slovenia) for the period of 1996 to 2019, taking into consideration institutional factors. The study analyses the variables: transition coefficient as a proxy for income gap, GDP per capita, KOF Financial Globalisation Index, Financial Development Index and World Bank Institutional Indicators in a panel approach methodology and estimation of FMOLS and DOLS equations. The paper’s findings show that all considered factors have a significant contribution to the income gap in the examined period of time. Economic and financial development, as well as institutional quality, is positively associated with the closing income gap, while globalization has a negative influence. It is also revealed the direction of the causality relationship between the considered variables: from economic and financial development, globalization and institutional quality to the income gap. These findings suggest some policy recommendations in support of the continuation of the European integration process.

This paper examines whether the quality-certification system might benefit developing economies while there is a widespread conjecture that the system might negatively affect technologically less developed economies. Based on a simple oligopoly model where a developing economy trades with an advanced economy that produces higher quality products, we demonstrate that the introduction of a quality certification system between technologically asymmetric countries might deteriorate the trade balance of the developing economy with the widened technology gap. In addition, we demonstrate that the empirical evidence from the Chinese experience of introducing a quality certification system for imported products from the EU supports the theoretical findings. That is, the imports from the EU to China have significantly increased with the increased quality gap after China introduced the quality certification system. The results implicate that the quality certification system might damage less developed economies when advanced economies hesitate technology transfer, and therefore, it is increasingly imperative to introduce an international coordination mechanism for active technology transfer when quality certification systems are introduced with respect to developing economies. [ABSTRACT FROM AUTHOR]

Much literature demonstrated the existence of general trade equilibrium in the Heckscher-Ohlin model, but no analytical solution has been reported yet. Dixit and Norman made a breakthrough showing that whole factor-price equalization set in integrated world equilibrium (IWE) shares the same world price. Helpman and Krugman enhanced the result, presenting the equal trade volume lines in the IWE diagram. Their ideas explored the new property and clue of trading equilibrium. Inspired by their ideas, this paper derives the price-trade equilibrium using Helpman and Krugman's equal trade volume lines and shows that world prices are the function of world factor endowments. The current study finds that the relative price of two factors at equilibrium is inversely propositional to their world factor endowments, which simulates the law of demand. The study demonstrates that the equalized factor prices ensure gains from trade for both countries. With the equilibrium, the Heckscher-Ohlin theorem and factor-price equalization theorem are linked together by term of trade. They can explain each other. Trefler illustrated that the factor price equalization hypothesis and the Heckscher-Ohlin-Vanek theorem hold in his equivalent-productivities system (effective endowments). The integrated price-trade equilibrium will be helpful to understand the equilibrium of factor price non-equalization. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to ascertain whether there is a positive relationship between cross-border transport infrastructural integration and income growth across Africa. The study employed the generalized method of moments technique and principal component analysis to develop a composite transport index and sample data from Globaleconomy.com for 28 African countries. There is a robust and positive relationship between transport infrastructural integration and income growth across Africa. The analysis also shows that the average sample transportation infrastructural integration index is 6.62, with an average per capita income of $5417.43, and an average gross domestic product growth rate of 4.43%. In contrast, countries that belong to a regional economic group such as the Southern African Customs Union (SACU) have an average per capita income of $10,174.02, and a transportation infrastructural integration index of 8.12, which is above the sample average. The sample contains ten landlocked countries, with a below sample average per capita income of $4219, a gross domestic product growth rate of 5.04%; and a transportation infrastructural integration index of 6.15. However, a novel finding of this analysis is that SACU landlocked members, when compared with all landlock countries, have a higher transportation infrastructural integration index (6.60), and a higher average per capita income ($8641.71). Therefore, this analysis confirms that increasing transport infrastructural integration across landlocked countries, together with joining regional economic integration groups, such as SACU, will increase average per capita incomes, and this will be transformational for Africa. [ABSTRACT FROM AUTHOR]

The current paper studies whether foreign direct investment (FDI) stocks led to higher linkages along regional and global value chains (R-GVC) in the Association of South East Asian Nations (ASEAN) against the backdrop of the developments such as the entry into force of the Regional Comprehensive Economic Partnership Agreement, COVID-19 pandemic, geopolitical events and growth of sectors such as those related to sustainability, health and electronics. It finds that high FDI has accompanied high R-GVC linkages in the recent years and FDI stock is a statistically significant predictor of R-GVCs in the ASEAN. The paper argues that the ASEAN countries, though in favourable FDI and R-GVC situations, must adopt strategies to move up the value chains. Further analysis of the nature of the R-GVC linkages of the ASEAN should provide insights on future policies. [ABSTRACT FROM AUTHOR]

Starting from Chinese A-listed firms' loan announcements, this research creatively constructs a dynamic, variant-linkage, and more comprehensive banking network in China during 2007 and 2016. Exploiting techniques from the literature on complex networks, we find that China's banking network exhibits more clustering, more coherence, higher centrality, and even more heterogeneity. Empirical results show that the above network features, especially the heterogeneity of the network, have a great impact on financial systemic risk. A network with higher clustering coefficient, higher coherence, lower centrality, and greater heterogeneity is associated with a lower financial systemic risk. A range of policy measures can be drawn from our results, including macro-prudential policy, increasing network stability, and applying surcharges for systemically important financial institutions so as to minimize financial systemic risk. [ABSTRACT FROM AUTHOR]

Aim/purpose – This paper surveys three decades of empirical literature on foreign direct investment (FDI) and international trade across the former Soviet economic space. In this survey, we outline the current state of research, discuss data limitations, and identify topics for further studies.