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Vol.1 No.2
December 2013

 Page Number

 Article Information

1-27

The Relative Importance of Industry and Size Effect in Corporate Capital Structure – Empirical Evidence from the EU Countries

Julia Koralun-Bereznicka

Abstract

This article aims to evaluate the relative importance of the industry-specific factors and the size-specific factors in relation to their impact on the corporate capital structure in certain countries of the European Union. The first, theoretical part of the study provides a literature review on the industry and the size as capital structure determinants. The following empirical research includes 9 EU countries, where the importance of the two factors is compared both for the aggregated data, as well as in individual countries separately. The source of the data is the BACH-ESD database. The applied methodology involves the analysis of variance and cluster analysis. The contribution of this paper is two-fold. First, it prioritizes the two factors in question, whereas most of the hitherto studies only identify the significance of various determinants of leverage. The second contribution is that this study is based on non-public firms – unlike the majority of studies which verify the capital structure theories using mainly samples of large listed companies.

Keywords: Capital Structure Determinants, Industry Effect, Size Effect, Cluster Analysis, EU

28-38

Top Income Shares in Greece: 1957-2010

Kostas Chrissis and Alexandra Livada

Abstract

This paper analyses the evolution of top income shares in Greece for the period 1957 to 2010 following Piketty (2001) methodology. We present the 10%, 5%, 2.5%, 2%, 1.5%, 1%, 0.5% and 0.1% income shares estimates which are based on tax statistics. The empirical results indicate that the behavior of the alternative estimated top income shares is quite similar. A ‘flat’ U-shaped pattern for most cases seems to exist. This common pattern is more apparent for the 2.5-0.1% top income shares. The top 10% and 5% income shares seem to be more volatile, accompanied with an increasing trend by the end of the period. This paper is an attempt to extend the existing research in southern Europe by presenting the relevant Greek experience. For the whole period,  country comparisons  show that the  1% top income share in Greece is in lower levels than that of USA and the other European countries (Italy, Portugal, Spain, France, Germany).

Keywords: Top Income Shares, Income Inequality, Greece

39-50

Tunisia’s Revolution and Youth Unemployment

Mohamed Siala and Nehed Ben Ammar

Abstract

Youth joblessness was one of the main triggers of Tunisia’s January Revolution. Unemployment rate in Tunisia has increased from 13 percent in 2010 to 18.3 percent in 2011 (NIS, 2011). Young people and women are more affected by this increase in unemployment .Thus, the purpose of this study is to examine the effects of various individual and job-related characteristics on the probabilities of unemployment of females and males aged 15–29 and to explore policy actions to create jobs in Tunisia. These issues are addressed using data from a 2010 survey of the National Institute of Statistics that provided information on the employment status of youth aged 15–29. The main estimated results show first that individual’s age, gender, marital status, level of education, sector of economic activity, type of employment and region of residence are significantly related to the unemployment. The results indicate that, for young workers, unemployment incidence increases with the level of education. Education has a greater impact on the unemployment of females than on that of males. Second, there is a negative and significant effect of the agricultural, educational and health sectors on the probability of transition into unemployment for women and men in which case the estimated impact is greater for men. Third, coastal area and public employment are associated with lower probability of transition into unemployment. Finally, Tunisian policymakers are aware of the fact that the elected National Constituent Assembly and the transitional government have a set of challenging tasks to accomplish in order to lower the rate of youth unemployment. For instance, generating funds for business development and infrastructure in non-coastal regions, and collaborating with the private sector to promote investment– whether foreign or domestic – and employment for educated young people.

Keywords: Unemployment, Gender, Education, Tunisia

51-54

View from Behavioral Economics Theory: Case of Latvian Rural Entrepreneurs

Igo Cals

Abstract          

The theory of classical economics treats entrepreneurs as subjects who make rational economic decisions. Empirical surveys prove the fact that daily economic decisions made by a separate economic entity can be explained by concepts of behavioral economics rather than classical economics. The economic behavior of entrepreneurs happens to be based on bounded rationality instead of financial justification. The objective of an economic activity presented as economically efficient can turn out to be socially important to a specific entrepreneur and not to national economy as a whole. In the EU countries, agriculture is a subsidised industry of national economy. In this light, status consumption and purchase of positional goods should create a special interest among economists. The objective of this article is to present true reasons of economic decisions made by rural entrepreneurs and to analyse the value hierarchy of Latvian rural entrepreneurs through carrying out a field work and with the help of set of instruments developed by modern economics theory.

Keywords: Behavioral Economics, Bounded Rationality, Conspicuous Consumption, Positional Goods, Rural Entrepreneurs

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