Journal of Economics

Journal Editors and Introduction

2023-11-23T17:40:24+00:00

Managing the economic and financial efficiency of an investment financed through local bonds

2023-11-28T18:24:32+00:00

The intention of the authors of this paper is to prove the efficient use of funds acquired from a local bond by investing in a self-sustaining project that generates returns - a rehabilitation center that will exploit the Kezovica thermal spring in the Municipality of Stip. The economic-financial efficiency of the investment financed through the issue of local bonds is shown through investment criteria that prove the profitability and liquidity of such an investment. In this way, the justification for the issue of local bonds as an alternative way of financing and supporting local economic development is achieved.
The purpose of this paper is to evaluate the return on investment potential, that is, the efficiency and profitability of a project that significantly contributes towards the increase of value of local output as a component of national economic growth, and even more, taking into account the increased current demands for socially responsible behavior, how it demonstrates value for a wide range of stakeholders in the long run.
The results of the research, projected in the form of conventional investment criteria, combined with a short financial ratio analysis, confirm that the efficient use of municipal bonds as an alternative way of financing local economic development can be achieved by investing in a long-term sustainable and profitable project such as is the analyzed example of the rehabilitation center.

Economic and Financial Determinants of Gold ETF Price Volatility on the U.S. Futures Market (COMEX)

2023-11-28T18:25:10+00:00

The price of gold ETFs on the COMEX market in the USA is influenced by both domestic and international economic and political factors. In our study, we focus on domestic economic variables as key drivers of gold ETF prices, using the Newey-West estimator to assess their impact, particularly in the presence of significant autocorrelation. Our analysis of domestic determinants over the past 15 years revealed noteworthy insights. CPI, the US dollar exchange rate, interest rates, and crude oil prices negatively affect gold prices. However, the 30-year fixed mortgage rate and the U.S. Economic Policy Uncertainty index had a positive impact. Gold remains a safe haven in times of economic uncertainty, but our model displayed some weaknesses with strong positive autocorrelation and heteroscedasticity in residuals. To address these issues, we constructed an alternative model, focusing on the most recent five years. Since 2017, we've observed a shift where inflation and interest rates no longer significantly affect gold prices. Recent interest rate hikes and high inflation had minimal impact, especially during stock market declines. Gold does not appear to act as a hedge against bear markets as it did during the Global Financial Crisis; instead, the US dollar may fulfill this role. Given the unprecedented economic disruptions caused by the Covid-19 pandemic, further research is needed to explore the effects of domestic financial and economic KPIs on gold prices and their interconnections and spillover effects.

Municipal Fiscal Capacity in North Macedonia

2023-11-28T18:25:34+00:00

The topic of fiscal capacity in Macedonian municipalites have become one of the essential aspects of local fiscal policy within the upcoming and curently stalled proces of fiscal decentralziation in N. Macedonia. It procures arguments that could enable independent and effiecent process in collection of own revenues. The size of fiscal capacity would help significantly in creating efficient tax and budget policy in central and local government. It could also help in achieving larger independence from the central government, but also would help to achieve equallization in some financialy endangered municipalities. Therefore, the fiscal capacity sugests that the tax collection is determined from tax capacity and capacity of the administration. Differences that apear in the colected own revenues are the reason for fiscal disparity. Fundamental part of the paper is the intention to determine the main methods of estimating fiscal capaciy and to measure the potenial fiscal disparity between some of the macedonian communities. It considers the potential revenues of the municipality obtained under the curent tax base with average tax effort. It is essential that the municipality controls those sources of revenue, such as the own revenues, common taxes and earmarked conditional transfers. Statistical data sugest that the discrepancies in fiscal capacity or collected real estate tax and development fee are predetermined from the differences arising from municipal tax base and the fiscal effort. Those variations are significant between urban, rural and city of Skopje. General transfers from the central government, especialy VAT subsidies, can achieve to some extent equalization in the revenue discrepancies.

Emprirical analysis of financial intermediation and economic growth: The case of Macedonian economy

2023-11-28T18:26:02+00:00

The main goal of the paper is to examine the relationship between the financial sector and economic growth in the Republic of North Macedonia. The Macedonian economy has been facing slow development dynamics and low rates of economic growth for a long period of time. The reasons are certainly multidimensional and identifying them is quite complex. Hence, our task in the paper is to examine the impact of the financial sector on economic growth as one of the factors. First we provide a theoretical model for the analysis of the relationship between the financial sector and economic growth, while in the second part of the paper we use a methodology based on the single-country regression analysis to investigate the relationship between the financial sector measured through the lending activity of banks to private sector and economic growth measured as real GDP growth. Furthermore, we present a comparative analysis of the trend in the level of banking intermediation. The results of the analysis indicate that financial intermediation is a significant factor for the growth of the Macedonian economy through gross investments, which depicts that improving financial intermediation and reducing the interest rate will increase investments and encourage the growth of the Macedonian economy.

Public Trust in the Auditors’ Work and the Prevailing Macroeconomic Conditions

2023-11-28T18:26:23+00:00

This paper aims to explore whether the audit profession is impacted by global economic growth, how, and to what extent. In that manner, the study paper explores the interrelationship between the public trust in the auditors’ work and the prevailing macroeconomic conditions. For the applied research methodology, the proportion of audit company revenue, for the period from 2005 through 2022, derived from audit services and non-audit services, is used as a proxy to measure ‘the public trust in the auditors’ work’ and ‘the audit expectation gap’. These resultants are multiplied to calculate the ‘public interest’, which is juxtaposed against the global gross domestic product growth for the same period, to support the conceptual assertion that the public interest follows the current trends in the global economy. The study finds that public interest is directly related to the public trust in the auditors’ work. In this view, enhanced demand for audit services implies an increased public trust in the auditors’ work. The higher the demand for audit services, the bigger the public trust in the auditors’ work. The function of the audit expectation gap implies the general public to obtain a bigger scope of data and information regarding the operational activity of the auditees. The audit profession is connected with global economic growth through the public interest. This is because public interest follows the current trends in the global economy. The higher economic growth is accompanied by bigger public interest. In this regard, bigger public interest implies a bigger demand for audit services which in turn increases the public trust in the auditors’ work. This paper which uses the public interest as an indicator for global economic growth, contributes to understanding the relationship between the audit profession and prevailing macroeconomic conditions.

Assessment of the current energy and price crisis impact on the Macedonian business sector

2023-11-28T18:26:47+00:00

In the past few years the world economy has faced with several serious economic crises, which have overlapped with each other. Firstly, the crisis determined by the Covid-19 pandemic, that has begun in 2020 as a health crisis in a short time has been recognized as a biggest economic shock of the 21st century on a global scale. Secondly, the period of economic recovery that took place in 2021, in the same time with the economic growth brought an increase in energy prices, especially oil and natural gas prices, as well as in food prices. Such tendencies have significantly intensified with the beginning of the war in Ukraine in February 2022, and plunged the world economy into a new energy and price crisis. All these subsequent crises dealt a heavy blow to the world population from an economic and social aspect and made it difficult for companies to operate normally on global scale. All these circumstances from the world economic scene have been quickly spilled over into the Macedonian economy, plunging the country into several overlapping crises. The aim of the paper is to provide more in-depth inside into the impact of the energy and price crisis on the performance of the Macedonian business sector. To fulfil this goal, we conduct a survey for the business sector. The paper is organized as follow. At the beginning of the paper an overview of the economic impact of Covid-19 crisis and energy and price crisis on the global scale is given. Further in the paper the economic implication of the pandemic and the current energy and price crisis in North Macedonia are elaborated. Analyzes of the economic impacts of the crises is based on the movement of the key macroeconomic indicators as: GDP growth rates, inflation, industrial production, gross debt, etc. Within the paper is also analyzed the impact of the current energy and price crisis on the Macedonian business sector based on the results of our own survey, conducted by the Center for Strategic Research “Ksente Bogoev” of MANU. The questionnaires used as an instrument for data collection were distributed electronically to the respondents (enterprises). The data collection period was one week (from 1 to 7 March, 2023). The survey was responded by 38 enterprises. The survey results give us a more comprehensive picture about the situation in the country, referring to the economic implications of the energy and price crisis on the business sector and satisfaction of the business sector with the implemented government measures.

The need, practice, and values of micro-credentials in the academic and business sector

2023-11-28T18:27:06+00:00

Industry 4.0 - the new order that reflects today's technological reality has only opened the "infinite Universe" of various possibilities and satisfaction of practical and business needs, so that the challenges in this sphere still exist, both in terms of improving and increasing the overall system of micro-credentials. Such changes have undoubtedly opened new industry sectors and professional disciplines and created some professions in more specific subspecialties, creating a greater need for continuous upskilling and improvement.
Micro-credentials as a modern concept of designing an educational-practical mix of knowledge and skills strengthens competitiveness in every industry and business environment. The concept of Micro-credentials also means setting up an adequate number of courses, practical skills within the academic and business community, or institutions that are accredited to combine such practical trainings, without having to invest in an expensive long-term educational and teaching process. Some typical examples of micro-credentials can be find in inter-modal domains as well as to acquired knowledge in ICT, digital entrepreneurship, digital marketing, data analytics, finance, corporate planning etc.
Micro-credentials can also play an active role and support the professional development and mobility of workers, including people in non-standard forms of work, such as those in the platform economy (all economic activity arising out of actual or intended commercial transactions in the internal market and facilitated directly or indirectly by online platforms, in particular online - intermediation services and online search engines), and who may have difficulties accessing training depending on their work status.
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In that regard, the institutions in the EU give an appropriate place to the concept of micro-credentials. According to the EU recommendation, the support is aimed to the development, implementation, and recognition of micro-credentials across institutions, businesses, sectors, and borders. An effective culture of lifelong learning is key to ensuring that everyone has the knowledge, skills, and competences they need to thrive in their personal and professional lives. The aim of this paper is to explain key concepts and provide description and specific position of the micro-credentials in academic and business sector as a stackable certification and a flexible way to address the demand for continuous learning and the need for agile, targeted education and skills development in response to rapidly changing job requirements and employability.