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This critical review explains the negative impact of the euro on the Spanish economy and its distortion in the period from 2002 to 2014. In this first cycle within the euro area, there was a financial boom, without voluntary savings, which generated a lack of coordination in the economic process and structure. The result was a bubble of overconsumption and malinvestments, which burst with a deflation of capital and wages, and a switch from construction industry to tourism services as Spain's main economic sector. The economic distortion was such that it delayed the exit from the Great Recession of 2008 and the European Financial Crisis of 2010 until 2014, with a recovery and the beginning of a new cycle. The Austrian business cycle theory and capital-based macroeconomics are used to support and illustrate the case study, with quantitative techniques: not to predict, but only to show the real development and to facilitate dialogue with other economic schools.

Remittances are a major source of income for many countries. In this regard, the importance of remittances to national economies is increasing. Altruism and self-interest are the two main motivations for remitting. Economic policy uncertainty may determine which of these motivations is more prevalent. Therefore, the aim of this study is to examine the altruism and self-interest hypotheses. In this study, unbalanced panel data are used to analyse the remittances received by the top 10 countries. These countries account for half of all remittances in the world. Due to cross-sectional dependence in our dataset, we need to use methods with robust standard errors. The results of four different estimation methods used for panel data are consistent. Economic policy uncertainty has a negative impact, whereas economic growth has a positive impact on remittances. These findings indicate that people who send remittances act out of self-interest. Trade openness contributes to an increase in remittances. Furthermore, the wealth effect shaped by self-interest leads to an increase in remittances from workers.

The literature on economic uncertainty has focused on the effects of uncertainty on the formal economy. Still, it has not addressed a relationship between uncertainty and shadow economy until now, to our knowledge. Therefore, this paper analyses the dynamic relationship between economic policy uncertainty and the shadow economy using panel vector autoregression estimates exploiting a dataset for 21 countries from 1997-2018. The impulse response analyses in this context reveal a mutual interaction of policy uncertainty and the shadow economy. In this respect, not only is the shadow economy found to respond to shocks in economic policy uncertainty, but also the uncertainty in economic policy appears to increase by a response to shocks in the shadow economy, implying a feedback effect from informal economic activities towards uncertainty. This effect is also thought to be responsible for aggravating negative influences of uncertainty on formal economic activities.

This study investigates whether the response of stock returns to economic policy uncertainty de- pends on the level of government size in the economy. Although there is a consensus in the liter- ature that stock markets react negatively to policy-related uncertainties, the factors that determine the magnitude of this effect have been ignored. This study is the first to demonstrate that the magnitude of this effect depends on the size of the government in the economy. In the study, data for the period 1997Q1-2021Q4 pertaining to 18 countries are used. According to results of fixed-effects estimations with Driscoll-Kraay robust standard errors, economic policy uncer- tainty affects stock returns negatively. In addition, the coefficient of interaction term formed by the variables of policy uncertainty and government size is also negative and significant. These results indicate that the negative response of stock returns to policy uncertainty grows as gov- ernment size increases. The sensitivity analysis results show that the findings are not sensitive to the estimations made by alternative approaches and are therefore robust. The findings of the study contain important implications for policymakers. Investors can also benefit from the results at the point of international asset allocation against future policy-related uncertainties.

The effects of the shadow economy on the environment have been amply documented in the literature; however, the relevance of financial inclusion and the unpredictability of economic policy are still up for debate. Therefore, this study examines the diverse effects of financial inclusion, shadow economies and economic policy on carbon emissions in 21 Sub-Saharan African countries from 2002 to 2019. To determine whether this hypothesis is true, this study uses the panel spatial correlation consistent (PSCC), method of moments quantile regression (MM-QR) and Dumitrescu-Hurlin (D-H) (2012) methodologies. The findings of the PSCC show that financial inclusion increases carbon emissions in SSA countries but the shadow economy and economic policy uncertainty have an adverse impact on emissions. Using the MM-QR estimation with fixed effects, the same results are obtained across all quantiles after accounting for the effects of the shadow economy and economic policy uncertainty over the conditional distribution of CO₂. The effect of financial inclusion on CO₂ emissions is positive, but only statistically significant at the 30^th to 70^th quantiles until traces of significance are erased. In addition, there is evidence of a two-way causal relationship between the shadow economy and CO₂ emissions, financial inclusion and the shadow economy, urban population and CO₂ emissions, renewable energy use and economic policy uncertainty, trade liberalisation and economic policy uncertainty, and financial inclusion and economic policy uncertainty. The empirical results of this study offer insightful policy suggestions to counteract the direct impact of financial inclusion and to amplify the damaging effects of the shadow economy and economic policy uncertainty on carbon emissions.

The paper deals with accumulation of foreign exchange reserves of central banks and its consequences in banking system liquidity management. In theoretical part the case of banking system liquidity surplus is analyzed focusing on creation of liquidity through FX operations, sterilization of liquidity and main sources of liquidity absorption. In this context it is analyzed how monetary policy instruments (on outright or repo basis) enable central bank to react on volatility of banking system liquidity needs and to cover issued currency in circulation and bank's reserves by net foreign assets. In empirical part these problems are analyzed and compared using the example of the Czech Republic, Poland and Hungary. The paper focuses on main differences in the level of liquidity surplus, cost of sterilization, volatility of spread between O/N reference interest rate and main policy rate, main sources of liquidity absorption and dynamics of currency in circulation and reserves covering by net foreign assets.

Various theoretical perspectives on the current macroeconomic development of advanced economies, indicating a slowdown in economic growth and labour productivity accompanied by very low inflation, are discussed. Mainstream opinion has been emphasizing the threat of se-cular stagnation, which would require much looser monetary policy compared to past decades. On the other hand, opinions pointing to the limits and risks of a long-term loose monetary policy are analysed. Special attention is paid to the phenomenon of deflation. Biases of measurement of basic macroeconomic indicators in the age of digitization are discussed as well. As a possible way forward in monetary policy, incorporation of labour market indicators seems to be promising. In the age of digitization, labour market statistics are more reliable than indicators of output and/or inflation. An experimental example of a modified Taylor rule for the Czech economy provides supportive arguments for using available indica tors from the labour market in the process of monetary policy decision making to a greater extent compared to current practice.

The social policy of the European Union is focused mainly on the most vulnerable group of citizens. The social instruments that countries use to increase the living conditions and to decrease social exclusion and vulnerability can differ between countries. The submitted paper uses cluster analysis to compare 27 member states of the European Union based on their social policy instruments in 2019. The study analyses the dependence of social policy instruments and household financial vulnerability using correlation and regression analysis. It examines whether higher levels of social benefits and government expenditure result in lower financial vulnerability. However, the results suggest that the financial vulnerability of households is not associated with low benefits. Clusters reporting a low level of benefits recorded a low financial vulnerability of households and vice versa. Results of the correlation and cluster analysis prove that the increase of the first factor (benefits in material need, expenditure on active labour market policy, family benefits, disability benefits) and the third factor (unemployment benefits) are associated with a decrease in financial vulnerability of households.

This article aims to determine and evaluate factors influencing migration behaviour and decision to migrate in 14 regions of the Czech Republic in the periods 1995–2018 and 2004–2018 (after the accession to the EU). The panel data analysis conducted mostly confirms our hypotheses on the impact of the analysed factors, confirming the impact of GDP growth, number of job listings at Labour Offices, number of job applicants, employment in industry and number of finished dwellings. The exceptions are the variables for the crime rate and number of college students in the region, where we found a positive but barely statistically significant coefficient. One group of factors (GDP growth, jobs at Labour Office, finished dwellings) prove to be pull factors, i.e., they are statistically significant and have a positive impact on migration flows. There are also two push factors, both of which represent the labour market situation and, to some extent, the structure of the economy in the region (number of job applicants and employment in industry). Their relationship with migration flows is negative and statistically significant, while several robustness tests are employed.

New approaches are being searched for to assess regional policy in connection with the specification of a new paradigm of regional development. The article pays attention to the assurance of a sustainable growth rate of economies in Czech regions. The methodological base of the solution is a thesis on the analogy between enterprises and regions as relatively open socio-economic systems with a function of the welfare maximisation. The data from 2002-2006 are analysed. The oscillation around the value "1" occurs with inter-annually in 10 regions from 14; the inter-annual oscillation is corrupted in 3 cases, when the trend continues in sequence, even though with other intensity. On the one hand, it is necessary consider all factors influencing regional policy tools; on the other hand it is also necessary to correctly consider the self-regulating elements effecting regions.

We analyze age-specific labor market dynamics in the Czech Republic, Poland and Slovakia over the period 2009-2012. We document a marginalized status of young workers aged 16-24, whose risk of job loss followed by unemployment is two to three times higher than that of prime-age workers (35-49). Further more, unemployed workers aged 50-61 face relatively the lowest probability of finding a job, at rates 30-50% lower than prime-age unemployed workers. These results are qualitatively in line with those established for the reference economy of the UK. Finally, we find that fluctuations in age-specific unemployment rates in all three countries are mainly driven by variations in outflow rates from unemployment rather than by variations in inflow rates into unemployment. In contrast, in the UK, the fluctuations in all age-specific unemployment rates, are decisively affected by variations in inflow rates into unemployment.

Immigration is a controversial and vital issue that has become an acute problem for countries facing cultural and economic difficulties resulting from it, and unemployment is at the forefront of these difficulties. According to theory, migration causes unemployment; thus, the causality relationship between migration and unemployment is empirically ex- amined in our study. For this purpose, we used a new test known as the Panel Fourier Toda-Yamamoto (PFTY) method for the period 1990-2019, which contributes to the existing literature from a methodological standpoint. This test allows investigating multiple structural breaks, cross-section dependence and country heterogeneity. Our first test results show that when we use the Dumitrescu-Hurlin (2012) test, the causal relationship is confirmed neither for any country nor the entire panel. However, when we employ the PFTY test, we reach causality runs from migration to unemployment for the entire panel and four countries.

The purpose of this article is to evaluate the subjective impact of provided care on the quality of life of informal carers, to assess the institution of long-term carer's allowances from the viewpoint of informal carers, and to identify additional social policy tools that could, in carers' opinion, improve the provision of care. Our research shows that provision of care leads to a reduced quality of life for a significant number of respondents. It is confirmed that respondents' welfare is negatively influenced by a lack of funding and weak development of social services. It is not proven that the long-term carer's allowance is a comprehensible benefit increasing the carers' quality of life providing enough motivation to care. This sickness insurance benefit is intended primarily for a temporary lack of self-sufficiency, with the prospect of future improvement. Long-term or permanent lack of self-sufficiency and the related care must be secured by social support and assistance mechanisms, including respite care, and ought to be funded outside the framework of sickness insurance.

This study is aimed to examine the relationship causality between energy security and growth for a total of 74 countries including 39 high-income countries, 23 upper-middle-income countries, and 12 lower-middle-income countries by using the Kónya´s (Kónya, 2006) Bootstrap Panel Granger Causality approach. According to the results obtained, it has been determined unidirectional causality relationship from energy security risk level to GDP for 14 countries and from GDP to energy security risk level for 20 countries. On the other hand, there is bidirectional causality between energy security risk level and GDP for 22 countries, while there is no causality between energy security risk level and GDP for 18 countries. Moreover, the results are also demonstrated that the rate of detection of a causality relationship increases as one moves from high-income group countries to lower-middle-income group countries. The results, which evidence the existence of a relationship between energy security risk level and economic growth for many countries, reveal the importance of the policies to be implemented in this direction.

Monetary metals have historically been important in providing limits to the quantity of money. The mandatory backing of money with gold or silver was gradually circumvented and abolished. Both precious metals have thus become, among other things, investment assets associated with returns and risks. They may or may not be profitable and safe. The absence of precious metal limits has led to a significantly faster devaluation of money. However, inflation may also be reflected in rising market prices for financial and real assets. This paper analyses the potential interrelationships between inflation, market prices of shares in the S&P 500 index, and market prices of gold over the period 1996-2020 in the United States. The analysis shows a strong impact of inflation on both the stock index and gold. The market price of gold was partly influenced by the development of market stock prices.

This paper examines the relationship between insurance market development and economic growth in EU member states in the period 1998-2018. Our results indicate that there is no causality between premium per capita and GDP per capita growth in the case of 11 out of the 23 analysed countries, including four countries classified as emerging markets. However, in the case of panel data covering all the countries, we determined a two-way causality between insurance market development and economic growth. In the short run, premium per capita has a positive and significant impact on the economic growth as proven in the data panel and in the case of individual countries, except in the case of Ireland and Luxembourg, where the applied model shows only error-correction coefficient values. Besides, our results indicate that premium per capita has a significant positive effect on economic growth in the long run in the case of Belgium, Cyprus, Bulgaria, Romania and Slovenia, i.e., insurance premium is a key determinant of long-term economic growth. The results show a statistically significant long-term positive relationship between premium per capita and GDP growth per capita in the case of a panel analysis of all the observed countries and countries classified as emerging markets. On the other hand, the panel data analysis of the countries classified in the category of developed markets showed a long-term positive relationship, but not a statistically significant one. Since that results indicate that the insurance market development could contribute to ensuring long-term economic stability and growth of observed countries, special attention needs to be paid to the strategy of insurance market development in a changing business environment.

Has the recent illiberal surge altered the neoliberal orthodoxy prevailing in post-1989 Hungary and Poland towards a more developmental modus operandi, or has it just camouflaged embedded neoliberalism with a developmental narrative? This article, trying to contribute to answering the aforementioned question, is structured as follows. First, we provide a general overview of the comparative capitalism approach. We extend the original conceptualizations by the framework of varieties of illiberal capitalism and present two ideal types of illiberal capitalism. Then, we assess five institutional areas of the political economy of contemporary Hungary and Poland. We conclude that although Hungary remains faithful to the neoliberal economic orthodoxy so far with illiberal political forces merely camouflaging its true essence due to political and utilitarian reasons, the post-2015 government in Poland managed to move its economic model closer to a more developmental modus operandi.

The main objective of this article is to analyse the institutional framework of labour market function. Theoretical literature has created a set of institutional aspects such as employment protection legislation, structure of wage bargaining, taxation of labour, active labour market policies, the system of unemployment benefits. On the basis of these institutional aspects and their setting we can judge general labour market setting or we can determine the dimension of labour market flexibility. Attention is also paid to influence of these institutional aspects on employment or unemployment.

Unconditional basic income should guarantee that all residents have sufficient material conditions for their existence. Compared to other existing social security programs, basic income is unique in its simplicity. It also supports the individuals' freedom of use of their disposible time. The article analyzes the expected impact of the introduction of an unconditional basic income on the labor market. It also compares basic income to other social security programs (wage subsidies, targeted social programs, a negative income tax and tax credits) on a theoretical level from the perspective of a recipient. Unconditional basic income's effects on labor supply would be rather negative. However, relative to other social security programs, unconditional basic income can guarantee a higher or the same utility level, but it may not motivate to participate in the labor market. Additional positives are transparency and lack of incentives to cheat. The prospect of lower administrative costs depends on the specific basic income scheme in question.

1997 was a turning point in the development of unemployment. The rate of unemployment grew steadily in 1998, in February 1999 reaching a record-high level in the history of unemployment in the Czech Republic: 8.3 %. Significant growth of long-term unemployment which is one of the most pressing problems on labour market, has been continuing since 1998. Czech labour market has been getting closer to standard labour markets; notable growth of long-term unemployment can therefore be expected in the next years.
Up-to now Czech experience with long-term unemployment is rather limited. On the other hand, some of extensive West-European experience could be used. Thanks to relatively low levels of long-term unemployment, the unique chance still exists to make the preventive employment policy with respect to long-term unemployed.
After having reviewed West European experience, one can conclude that in Czech conditions some of projects could be useful to adopt. Common features observable at almost all programmes are the individual approach to unemployed persons and combination of different types of measures. Generally, active employment policy should be given wider space within Czech practice.

Pension systems are strained with negative impacts on the state budget as a consequence of the endangering trend of worsening demographic structure and population aging. The aim of this paper is to map trends of employment rates of persons 65-69 years old in the Czech Republic and Slovakia between 1998 and 2017 and to analyse selected determinants affecting these rates. These determinants are then subjected to statistical and regression analysis using panel data for the period 1998-2017. Based on the analysis results, the authors come to three conclusions for both countries: firstly, the increase in pensions is not a limiting factor in the employment of persons aged 65-69; secondly, the participation of persons with tertiary education is of great relevance, implying the need for support to tertiary education; thirdly, the results confirmed the significance of the health determinant of persons aged 65-69, ensuing the need for stimulating investment in health.

The central banks of developed countries and those in the region of Central Europe responded to the global financial crisis of 2008 and subsequent economic recession by considerably easing monetary conditions and using new monetary policy tools. One of those tools was the entry into the so far uncharted territory of negative interest rates. The passage of some years after the inception of these new tools has allowed the emergence of new empirical literature, which addresses their effects and effectiveness. The primary objective of this paper is to examine and summarize the empirical literature that deals with the effective lower limit of interest rates, especially in relation to the banking sector and bank interest margins. We then use empirical findings from other countries and apply them to the Czech Republic and draw conclusions for the future monetary policy of the CNB. Our results confirm that the CNB has got enough manoeuvring room even in the area of negative interest rates, which it can take advantage of either for the purpose of price stability, or for more effective management of FX operations.

Occupation Policy in Protectorate of Bohemia and Moravia Industry: An Example of Škoda Works The study describes occupation policy and administration, including goals in the Pro-tectorate of Bohemia and Moravia. It analyses measures carried out by the occupation administration in the manufacturing, more specifically in the armament industry, and presents selected specific measures and their impacts on the industrial sector and arms production. In this regard, the company Škoda Works, the largest arms manufacturer, serves as an illustrative case study. The measures affected the Protectorate industry, which was completely restructured based on the needs of the German war economy. By analysing selected principles of the administration's operation, specific measures and their real effects on the arms industry, the study shows the potential and real economic significance of the German occupation of the Czech lands.

The study provides estimates of the size of the fatherhood premium for the Czech Republic in the years 2006‒2017, using data from the EU SILC survey. In the years 2006‒2009, the fatherhood premium in the Czech Republic does not manifest itself if explanatory variables include the marriage premium and the partner's labour market participation. The fatherhood premium only starts to express itself in 2010 and the following years, when it reaches values from 11% to 15% as a consequence of a decision of families with high-income fathers to have a third child in the years after 2010.

This paper examines the development and comparison of competition and concentration in the banking and insurance sector in the Czech Republic during the 2007-2019 period using the Herfindahl-Hirschman index (HH index). In the empirical section we calculate the degree of concentration and indexes separately for the banking and insurance markets, where the main variable in relation to banks is the balance sheet and this variable is the gross written premium in relation to insurance companies. Subsequently, we compare the two examined sectors including the analysis of their long-term equilibrium. The result of this research confirms the determined hypotheses, whereas the oligopolic structure of both markets, which falls over time and aims towards a competitive market but does not achieve this goal during the monitored period. Throughout examination, the insurance market demonstrates higher HH index values and therefore lower competitiveness compared to the banking market.

The aim of the presented research is to quantify the costs of unemployment in the Czech Republic in the years before start of the 2020 exogenous crisis. The costs of unemployment are quantified as direct costs and induced costs. The research method is based on the con- struction of the average unemployed. I identify his/her average income level, length of unemployment and age, as well as level of education. The analysis also quantifies the economic effectiveness of hypothetical economic policy measures in maintaining employment.

There is growing interest in property prices and price trends at national and regional levels. The paper aims to find links between selected demand and supply determinants based on a panel regression of regional data during 2000-2017 and to contribute to further discussion of the role of these determinants. The main output of the paper is the identification of regional differences in the direction and strength of the influence of individual determinants on the flat price. Regional differences were identified in the mid-year population, the number of inhabitants per completed flat, the number of applicants per job, the amount of household disposable income and the divorce rate. In Prague, the first three determinants were significant. The validity of the research is limited by the fact that some potentially significant data are not statistically monitored and data aggregated at the level of regions do not reflect local conditions. The output of the analysis shows determinants that explain the price variability and indicates unused economic policy instruments.

The aim of the paper is to verify the sensitivity of national labour markets to economic growth while respecting its sources and different growth trends. We monitored the change in employment caused by economic growth in the set of EU27 member states in the period 2000-2019. The sensitivity of the labour market was quantified by finding the values of the elasticity coefficient. To obtain it, we used a relation to calculate the point elasticity as well as a logarithmic linear regression model compiled for each member state. The differences in the response of the labour market were identified by comparing the values of the indicator. To determine the factors of employment changes, partial analyses were performed by dividing the evaluated period into sections, especially into periods of growth and decline. As a result, it was possible to identify the impact of economic development trends on the elasticity of the labour market. At the same time, subsets (groups of countries) were created based on similarity of labour productivity levels and employment rates. The results of the analyses indicated that the labour market in all cases responded to changes in economic performance in a short period of time, while the strength of the influence is also affected by the stability of economic development.

The sovereign debt crisis inside the European Monetary Union (EMU) as well as competitiveness problems of some EMU members made the members and non-members of the club address one question: Is a monetary union advantageous? This paper deals with the issue whether or not the Maastricht criteria are good indicators for deciding to join the eurozone, namely for a small open economy, as the Czech Republic. In particular, this analysis addresses the issue of price competition, which can be measured by the real effective exchange rate. In fact, the Maastricht criteria do not reflect the competitiveness of a country. Thus the arguments concerning the advantages/disadvantages of the adoption of a common currency should not be based only on the Maastricht criteria, but at first on the philosophy of the real effective exchange rate. We define a basis for setting new criteria to decideing on joining the monetary union. To sum up, if depreciation/devaluation of the real exchange rate is not a competitive advantage for both Czech exports and the Czech economy (especially in the long term), then the main economic argument against joining the EMU disappears.

Revision of Marc Lavoie's Monetary Model by the Endogenization of the Parameter γ This paper tries to point out a fallacy in Lavoie's (2006) conclusion that incorporation of deep endogeneity of parameters into the PKA model suffices to bring about irreversibility of such a system. The arguments of the authors are supported by Setterfield's (1998a, 2008) concept of hysteresis as path-dependence in the long-run outcome of systems with direct shocks. The paper shows that extension of Lavoie's PKA model by deep endogeneity of the parameter γ causes the fulfillment of the necessary condition of hysteresis - Setterfi eld's condition (a) ensuring deep endogeneity of the alleged exogenous parameter and, by means of this, path dependence in the long-run output - but not the fulfi llment of the sufficient condition of hysteresis - condition (c) ensuring the presence of adjustment asymmetry and, by means of this, irreversibility. Thus, deependogenisation of the parameter γ does not bring about Setterfi eld's hysteresis and, in effect, does not cause irreversibility.