List of issues

Contents of issue 4/2016

Adam Koronowski - Technological Progress and Unemployment: Luddism and Beyond, abstract, article

Krystyna Gawlikowska-Hueckel, Jacek Szlachta - The Vulnerability of Polish Regions to the Challenges of the Modern Economy, abstract, article

Witold Małecki - The “Financialization” of Business Cycles and its Consequences for Stabilization Policy, abstract, article

Paweł Baranowski, Artur Gądek, Damian Stelmasiak, Szymon Wójcik - What Drives Economic Migration Plans? Microdata Analysis for Poland, abstract, article

Piotr Mielus - Financial Market Index Reform Dilemmas, abstract, article


Economic Neoliberalism and Regional Disparities - Kazimierz Kuciński

Book Review: Janusz Szewczak, Banksterzy. Kulisy globalnej zmowy (The Bankers: The Inner Workings of a  Global Conspiracy), Biały Kruk, Warsaw 2016, 192 pp. - reviewed by Marek Lubiński

Adam Koronowski - Technological Progress and Unemployment: Luddism and Beyond

The aim of this paper is to reconsider the role that technological progress plays in bringing about growing economic inequality and "secular stagnation."
The main part of this paper is a theoretical analysis of the impact that technological innovation has on income distribution. The author argues that standard assumptions related to the production function, though seemingly neutral, have far-reaching consequences for economic reasoning concerning income distribution. Wages and employment are not subject to precise solutions resulting from economic optimization reflecting the technical properties of the production process, but are a result of an interplay of social and political factors at any level of employment. Moreover, technological innovations are labor-economizing in nature and eliminate any grassroots competition due to advantages of scale. As a consequence, the share of labor income declines.
The second step of the analysis concerns the consequences of evolving income patterns for aggregate spending. Along the lines of reasoning typical for Kalecki, the author argues that the declining share of labor income gives rise to stagnation and persistent unemployment.
As a whole, the analysis helps explain the "secular stagnation" and persistent unemployment combined with high profits, a process that breeds confusion in contemporary economics.
Finally, the author reconsiders possible corrective policy measures. Globalization shows to be a major obstacle to any action that an individual government might decide to undertake with respect to the problem at hand.

Keywords: technology, unemployment, income distribution, economic policy, globalization
JEL classification codes: E24, E25, E32
Article: PDF

Krystyna Gawlikowska-Hueckel, Jacek Szlachta - The Vulnerability of Polish Regions to the Challenges of the Modern Economy

The paper deals with the conditions affecting the economic growth of Poland`s regions. Research questions are initially formulated about regularities and factors contributing to the economic success of Polish regions after their market-oriented transition.
Changes in the theoretical foundations of regional policy are then discussed as well as the contribution of the World Bank, the Organization for Economic Cooperation and Development (OECD), and the European Union (EU) to the new doctrine. The global and European megatrends of recent decades - unfavorable to regions in EU member states, in part due to the 2008+ crisis - are described. The European cohesion policy, a unique solution globally to support regional development, plays a major role in the socioeconomic development of Poland`s regions. Poland is the EU`s biggest beneficiary of this policy, which is now oriented toward boosting regional competitiveness. Polish regions are steadily becoming stronger within the EU, as this paper demonstrates, with the best growth trajectories enjoyed by the strongest regions. The impact of the 2008+ recession on Polish regions was limited, largely thanks to quality public policies. This good trajectory may be hard to achieve in the future due to what is known as the middle-income trap. Therefore, adjustments have to be made in Polish regional policy and other policies to make regions less vulnerable to the volatility of socioeconomic development.

Keywords: European cohesion policy, regional development, globalization
JEL classification codes: F15, F63, R19
Article: PDF

Witold Małecki - The “Financialization” of Business Cycles and its Consequences for Stabilization Policy

The purpose of this paper is to interpret the phenomenon of "financialization" of business cycles and identify its consequences, which take the form of indispensable, substantial changes in the way stabilization policy is applied. The paper also aims to present further desirable research directions concerned with both the theory of business cycles and the Polish economy.
To this end, the term, origin, and manifestations of financialization of business cycles is illustrated. Next an attempt is made to propose a "new" stabilization policy taking into account the full complexity of the process of financialization of business cycles based on a critical analysis of both the existing stabilization policy and proposals for changes to this policy that have been put forward in the literature in recent years.
The financialization of business cycles means a radical increase in the importance of financial factors in the generation and course of business cycles. Three of the many conclusions regarding stabilization policy seem to be the most significant. First, the most important role of stabilization policy is prevention in the growth phase of the business cycle - based on preventing credit booms that lead to the emergence of speculative bubbles on the real property and/or asset markets. Second, in the recession phase, it is critical to correctly recognize the nature of this recession as this determines the way stabilization policy should be pursued. In particular, balance sheet recessions require specific stabilization-oriented actions to be taken. Third, stabilization policy should be understood in broader terms than it traditionally is; it should rather be seen in terms of economic policy.

Keywords: financialization, business cycles, financial cycles, stabilization policy
JEL classification codes: E32, E52, E58, E61, E62, E64, H30
Article: PDF

Paweł Baranowski, Artur Gądek, Damian Stelmasiak, Szymon Wójcik - What Drives Economic Migration Plans? Microdata Analysis for Poland

The aim of the paper is to identify factors influencing economic emigration. The authors use data from socioeconomic surveys (Social Diagnosis 2015 and 2013) with samples of more than 18,000 individuals for the Polish economy. They focus on responses to a question about their potential labor emigration plans, which are seen as a prelude to actual emigration. The outcome of this question was binary; hence a logit model was applied.
The results indicate that the key drivers of the propensity to emigrate are registered unemployed status, fluency in at least one foreign language, new skills acquired during the year prior to the survey, and social attitude. On the other hand, older people, women and more educated individuals are less eager to emigrate. The propensity to migrate is also determined by family factors.

Keywords: migration, socioeconomic survey data, logistic regression, micreconometrics
JEL classification codes: F22, J61, C25, C50, D04
Article: PDF

Piotr Mielus - Financial Market Index Reform Dilemmas

The aim of the article is to present the current state of efforts to reform financial market indexes, with a particular reference to how the proposed changes would affect the money market.
Financial market indexes must be reformed under a Regulation of the European Parliament “on indices used as benchmarks in financial instruments.” The article verifies the thesis about the existence of a conversion path for indexes that would not threaten the stability of the market and ensure legal continuity.
In order to verify the thesis, the author studies documents published by regulators and benchmark administrators in order to present the debate on possible opportunities and threats to the financial market resulting from specific solutions proposed by various stakeholders. The methodology applied in the article includes economic and legal research for the assessment of proposals regarding the liquidity and stability of the financial market.
The author highlights the possible consequences of benchmark transformation on the reliability of financial indicators applied to the valuation of loans and derivatives.
The conclusions of the analysis cover two basic aspects. First, an optimal definition of the index and the related methodology is proposed. Second, the author identifies a conversion path that minimizes the risk of destabilizing the financial market. The index is optimally defined as based on actual transactions. In the absence of a sufficiently liquid underlying market, the definition requires the transaction base to be broadened. In the case of money market indexes, non-bank deposits need to be taken into account. The new index definition will lead to changes in the level and variance of the benchmark, which may threaten the stability of contracts concluded on the financial market. It is therefore necessary to ensure the parallel publication of indexes according to both the old and new methodology.

Keywords: financial market indexes, money market, financing cost, basis risk
JEL classification codes: G01, G14, G15
Article: PDF

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