Central European Economic Journal, Dluga 44/50, Warsaw (2025)

31/01/2025

Sustainability disclosure and its impact on firm's value for Energy and Healthcare industry
by Daniela Constantinescu https://sciendo.com/pl/article/10.2478/ceej-2021-0022
This research published in Central European Economic Journal examines the relationship between sustainability disclosure, measured through combined and individual environmental, social, and governance (ESG) scores, and the value of European companies in the energy and health care industries.
The study analyzes data from 👉 61 companies in the energy sector (305 observations) and 👉 45 companies in the health care sector (225 observations). Two linear regression models were used to assess the impact of sustainability disclosure on firm value.
Key findings include:
Energy Sector: A negative and significant correlation was found between the environmental factor (E in ESG) and firms' value.
Health Care Sector: No significant influence of sustainability disclosure on the value of companies was observed.
The research contributes to the literature by examining the impact of sustainability disclosure on company value in sensitive industries, utilizing both combined and individual ESG scores. This study offers valuable insights and encourages further academic exploration in this area.

27/01/2025

Exploring D as demand ...ni this case: Liquidity in Complex Financial Systems

Understanding liquidity demand—the need for liquid assets to settle transactions in financial systems—is critical for managing financial stability and mitigating risks in payments and settlements. A study published in Central European Economic Journal Topology of Complex Networks and Demand of Intraday Liquidity: Based on the Real-Time Gross Settlement System by Mu Tong and Yi He https://sciendo.com/pl/article/10.1515/ceej-2017-0010

delves into how the structure of capital flow networks influences short-term liquidity demand at both system and member levels.

🔑 Key Takeaways from the Research:

Strength Matters: A node's (or member's) strength impacts its liquidity demand, while the overall strength distribution affects the system’s liquidity needs.

Leakage Effect: Increased liquidity leakage amplifies the system’s liquidity demand, but its distribution among members has little effect when other variables remain constant.

Dominant Factors: When multiple factors, such as strength and leakage, are in play, leakage effects emerge as the dominant influence on liquidity demand.

💡 Why It Matters:

The findings highlight critical insights for liquidity risk management and policy design in financial networks, especially in real-time settlement systems. Policymakers and regulators can use these insights to optimize liquidity rescue strategies and strengthen financial system resilience.

👉 Read the full article to explore how liquidity flows interact within complex capital networks and the implications for financial system management: [Link to the article]

24/01/2025

📚 Research Highlight from Central European Economic Journal 📚

Friday is always a good day to highlight a noteworthy paper published in the Central European Economic Journal, which offers valuable insights into the ongoing debate around tax policy: reconciling equity and efficiency through the optimal trade-off between direct and indirect taxes.

Equity-efficiency dilemma and tax harmonization
by Basil Dalamagas, John Leventides and Stefanos Tantos

📊 Key Insights:

This paper, which combines theoretical and empirical analysis, delves into the impacts of different tax structures:

Direct Taxes: While crucial, these taxes can discourage work effort, savings, and investment, potentially stifling economic growth.

Indirect Taxes: Though they reduce consumption, these taxes tend to place a heavier burden on lower-income groups.

🔍 Main Finding: The research suggests that a well-calibrated mix of direct and indirect taxes can help minimize distortions in the consumption-leisure decision, leading to a more efficient and equitable allocation of resources. By maximizing a social welfare function, the study provides a theoretical framework for identifying optimal tax rates that balance equity and efficiency goals.

🌍 Why It Matters:

Though published some time ago, the paper remains highly relevant for policymakers grappling with the challenge of designing tax systems that are both fair and growth-oriented. Its findings offer crucial guidance for future tax reforms aiming to strike a balance between revenue generation and economic fairness.

🔗 If you haven't yet explored this research, we encourage you to read the full paper in Central European Economic Journal https://sciendo.com/pl/article/10.2478/ceej-2022-0020 https://ceej.wne.uw.edu.pl/

21/01/2025

🚀 New Research Alert in Corporate Bond Markets! 🚀

We are thrilled to announce the publication of a groundbreaking study that examines the impact of split ratings on corporate bond yields — the first of its kind to offer insights into the implications of inconsistent credit ratings on investment outcomes.

Does Split Rating Affect Corporate Bond Yields? Evidence from North America and Europe

by Irina Kolegova and Tetiana Paientko

https://sciendo.com/pl/article/10.2478/ceej-2025-0002

The study, which spans corporate bonds issued between January 2000 and May 2023, reveals that split-rated bonds (those with differing ratings from multiple agencies) exhibit higher yields.

Investors demand greater compensation for the risk associated with split ratings, which are driven by informational opaqueness and uncertainty surrounding these instruments.

Notably, the magnitude of the rating gap directly correlates to higher bond yields, underlining the heightened risk perceived by investors.

💡 Implications for the Market:

Investors and issuers alike must carefully evaluate split-rated bonds, as inconsistencies in credit ratings can signal potential risk factors.

By shedding light on this relationship, the study emphasizes the importance of transparency and consistent credit assessments to promote more informed and confident decision-making in the corporate bond market.

This research serves as a valuable tool for improving the way we understand risk and pricing in the bond market, encouraging better practices for risk management and investment strategies.

Read the full study to learn more about how split ratings can impact the future of bond investments!

20/01/2025

🗳️💡 Exploring C as in ... Contingent Valuation Referendum: Insights into Truthful Preference Elicitation 💡🗳️

How do we gauge public support for policies impacting our environment, culture, or transportation? Enter the Contingent Valuation Referendum (CVR)—a powerful tool that blends survey techniques with decision-making processes to assess the value of public goods.

A study published in A Consequential Contingent Valuation Referendum: Still Not Enough to Elicit True Preferences for Public Goods! by Ewa Zawojska https://sciendo.com/pl/article/10.1515/ceej-2017-0012

delves into the mechanics of the CVR and the critical role of survey consequentiality in ensuring truthful responses.

📊 Key Takeaways from the Study:

CVR presents policy scenarios to respondents, asking them to vote "yes" or "no" on a proposal, mirroring the structure of an advisory referendum.

Truthfulness is key—but it hinges on respondents believing their votes will influence real-world outcomes (e.g., policy implementation or associated costs).

Mixed findings: While stronger belief in survey consequentiality often increases willingness-to-pay (WTP) estimates, other studies suggest it might decrease acceptance rates for costly projects.

🔍 Why it Matters:

Understanding the dynamics of CVR and survey consequentiality is crucial for policymakers aiming to:

Accurately assess public preferences.

Design fair and transparent policy instruments.

Improve trust in survey-based decision-making methods.

✨ Curious to learn more?

Dive into our exploration of theoretical insights and 25 years of empirical studies on this topic in the Central and Eastern European Journal of Environmental Economics and Management.

Let’s discuss how tools like can shape sustainable and inclusive public policies! Comment below or share your thoughts. 🌍

17/01/2025

🌍💧 Clean Water, Valued by All: Unlocking Public Support for Sustainable Solutions 💧🌍Application of the Contingent Valuation Method in Water Resources Protection
by Rafał Miłaszewski
This research delves into the transformative potential of the Contingent Valuation Method (CVM) for guiding water resource protection policies and decision-making.
🔬 What’s the study about?
Over 25 years, we analyzed public perceptions and willingness to fund solutions addressing surface water pollution. Through direct interviews, CVM helped quantify community support for:
🌊 Reducing Baltic Sea eutrophication (1994).
🏗 Building municipal sewage treatment plants in Greece and Poland (2005–2009).
🚰 Upgrading sewage standards in Śniadowo, Poland (2017–2019).
✨ Why it matters:
CVM empowers local authorities to align policy objectives with public needs, ensuring investments in clean water are both effective and widely supported. By connecting community preferences to actionable strategies, this method is a cornerstone for sustainable water management.
💡 Takeaways for policymakers and researchers:
CVM is more than just a valuation tool—it bridges public priorities with environmental action, enabling informed, data-driven decisions for a cleaner future.
📰 Read the full article to see how we can drive impactful change for water resource protection: https://sciendo.com/pl/article/10.2478/ceej-2021-0015
Let’s shape a sustainable future for our water systems—your thoughts and ideas are welcome below! ⬇️
hasztag hasztag hasztag hasztag hasztag

14/01/2025

Comparative Analysis of Hedonic Wage and Discrete Choice Models in Valuing Job Safety by Nan Zhang https://sciendo.com/pl/article/10.2478/ceej-2025-0001

🌟 Exciting Start to 2025 in Central European Economic Journal! 🌟

publication of the first study of 2025 which presents comparison of two widely used models in labor economics: the Hedonic Wage Model and the Discrete Choice Model.

🔍 Key Highlights:

This study takes an innovative approach to evaluate job safety by comparing these two models in the context of real-world job market choices. Here’s what the research reveals:

Hedonic Wage Model: The traditional method for estimating the Value of Statistical Life (VSL) by observing wage differentials related to mortality risks.

Discrete Choice Model: A newer method used for valuing non-market goods, often applied in hypothetical job selection scenarios.

💼 Study Methodology: The paper utilizes real market data from Taiwan’s Panel Survey of Family Dynamics (PSFD 2016-2018), examining how workers make industry choices and their willingness to pay for job safety.

⚖️ Key Finding: By comparing the two models, the study finds that the Marginal Willingness to Pay (MWTP) for risk reduction in the discrete choice model is significantly larger than expected, ultimately favoring the Hedonic Wage Model as the more reliable approach for estimating the value of job safety.

🌍 Contribution to Literature: This paper contributes to the growing body of research comparing the Hedonic Wage and Discrete Choice Models, particularly in the context of evaluating environmental goods, a field typically dominated by housing market data.

📖 This study not only provides valuable insights into job safety valuation but also offers a fresh perspective on the methodologies used in labor economics. It’s an essential read for researchers and policymakers interested in labor market choices, risk valuation, and econometric modeling.

🔗 Don’t miss the full paper – check it out in Central European Economic Journal!

13/01/2025

🌟 B for ...Block Maxima in Financial Risk Analysis 🌟
When predicting rare and extreme financial events, understanding the Block Maxima method from Extreme Value Theory (hasztag ) is essential. But what exactly is it, and how does it apply to forecasting market risk?
🔍 Block Maxima Explained:
This method involves dividing a dataset (e.g., daily stock index returns) into equal intervals or "blocks" (e.g., monthly or yearly periods). Within each block, only the maximum value is considered for analysis. These maxima represent the most extreme outcomes during their respective intervals, forming the basis for predicting rare events.
📊 In the Context of Market Risk:
In the Central European Economic Journal study Comparison of Block Maxima and Peaks Over Threshold Value-at-Risk models for market risk in various economic conditions by Filip Szubzda and Marcin Chlebus https://sciendo.com/pl/article/10.2478/ceej-2019-0005
the Block Maxima method was applied to assess Value at Risk (VaR) forecasts for major European stock indices across different economic conditions: pre-crisis (2007), crisis (2008), and post-crisis (2009).
Strengths: Effective for identifying long-term extreme trends, particularly in stable markets.
Challenges: During periods of market turmoil, such as the 2008 financial crisis, static Block Maxima forecasts struggled to adapt to rapid changes in volatility.
💡 Key Takeaway:
Block Maxima provides valuable insights into extreme market risks but may require dynamic enhancements to improve real-time adaptability, especially during crises.
If financial risk forecasting intrigues you, explore the full study in CEEJ and consider submitting your own research. Let’s continue advancing our understanding of market extremes!

10/01/2025

Tax revenue and economic growth in developing country: an autoregressive distribution lags approach
by Mnaku Honest Maganya 👉 https://sciendo.com/pl/article/10.2478/ceej-2020-0018
So this Friday we're🌍 Unlocking Tanzania’s Economic Potential through Taxation – Insights from CEEJ 📈
How can taxation fuel sustainable economic growth? Tanzania, like many developing nations, grapples with leveraging taxes as a tool for development. A fascinating study published in the Central European Economic Journal delves into this critical question, exploring data from 1996–2019 using advanced econometric techniques.
Key findings:
✅ Domestic Goods & Services (TGS) Taxes are positively linked to GDP growth, showing significant potential to drive economic expansion.
❌ Income Taxes, however, exhibit a negative relationship with GDP growth, raising questions about their design and implementation.
🔄 Bidirectional Causality exists between TGS and GDP growth, suggesting a dynamic interplay that policymakers can harness.
The study highlights the importance of growing and sustaining the tax base to further enhance Tanzania’s economic trajectory.
🔍 Whether you’re interested in tax policy, economic development, or the transformative power of data-driven insights, this paper is a must-read for understanding taxation’s nuanced role in developing economies.
📢 We invite researchers and policymakers to join the conversation! Could your research on taxation or economic growth contribute to the next edition of CEEJ?

08/01/2025

🌟 The Journey of Inspiration in Research: A Story of Passion, Struggles, and Breakthroughs 🌟

Research is often portrayed as a logical pursuit of knowledge—but every researcher knows it’s also a deeply emotional journey. The spark of inspiration, the grind of analysis, and sometimes, the overwhelming weight of burnout are all part of the process. Let’s talk about how inspiration comes (and how it sometimes hides), especially in the fields of social sciences and economics.

🎇 When Inspiration Strikes:

For many researchers, inspiration often arrives unexpectedly—during a walk, a conversation, or even a mundane daily activity. A famous example? Nobel laureate Daniel Kahneman, whose work on decision-making biases emerged from conversations with his colleague, Amos Tversky, about everyday quirks in human behavior.

Similarly, groundbreaking economic theories often begin with simple questions. Take Thomas Piketty's Capital in the Twenty-First Century—its core idea grew from a curiosity about long-term data trends in inequality.

📉 The Struggles Along the Way:

is a reality for researchers, especially when navigating the unpredictable terrain of social sciences. When inspiration wanes, the routine becomes heavy, and the why of research fades. A 2021 study in Nature Human Behaviour found that 71% of social scientists reported declining during prolonged periods of .

💡 Finding Inspiration Again:

Collaborate: New perspectives often reignite old passions.

Seek the world’s questions: Sometimes, global events, like the 2008 financial , spark entirely new fields of inquiry.

Reflect: Some of the most innovative work comes from revisiting old ideas with fresh eyes.

💬 Your Turn:

What inspired your most memorable research idea? Share your story in the comments—we’d love to hear! And if you’re feeling stuck, remember: the next spark could come when you least expect it.

07/01/2025

No scientific journal can function properly, unless it is assisted by reviewers. The editors are aware of the fact that an adequate assessment of the academic excellence of manuscripts received calls for a much broader perspective than that they can provide themselves. Therefore, we gratefully acknowledge the support of our referees. It seems to us that these double-blind peer reviews are appreciated by the authors too, as they allow for improving their texts significantly.

https://ceej.wne.uw.edu.pl/reviewers-in-2024/

06/01/2025

Welcome fresh 2025 📊 A for ... Amihud’s Estimator: A Key Tool in Analysis 📊

In the world of financial markets, understanding the relationship between an asset’s returns and its liquidity is essential for both investors and researchers. One of the most effective measures of liquidity is Amihud’s Estimator, which quantifies how much an asset's price changes in response to trading volume. This measure provides crucial insights into the asset’s price impact and liquidity, making it an indispensable tool in asset pricing models.

🔍 What is Amihud’s Estimator?

’sEstimator is a measure of market liquidity that calculates the price impact of trading activity. It is defined as the ratio of the absolute return on an asset to its trading volume. A higher value indicates lower liquidity (i.e., price movements are more sensitive to trading volume), while a lower value suggests higher liquidity.

In simpler terms, Amihud’s Estimator helps to answer: How much does the price of an asset move for a given amount of trading volume?

📚 Amihud's Estimator in Asset Pricing Models

Amihud’s Estimator is widely used to complement traditional asset pricing models, like the Capital Asset Pricing Model (CAPM), Fama–French models, and Carhart models, which focus on factors like market risk and company-specific factors. However, these models often fall short when accounting for the impact of liquidity on asset returns.

A study published in CEEJ: Liquidity and solvency of a company and the rate of return – an analysis of the Warsaw Stock Exchange by Justyna Zalewska and Natalia Nehrebecka

https://sciendo.com/pl/article/10.2478/ceej-2019-0013

explored the use of Amihud’s Estimator to augment traditional asset pricing models. The research emphasized that liquidity or solvency should be incorporated into these models for more accurate predictions of asset return behavior. By integrating Amihud's measure, the study showed that asset liquidity plays a crucial role in explaining the volatility of returns and the risk sensitivity of an asset.

Key Findings:

The study highlights that the liquidity factor is often overlooked in classic models, but it is essential in determining an asset’s true risk profile.

Amihud’s Estimator helps in identifying how liquidity impacts the price sensitivity of assets, offering investors a more comprehensive risk assessment.

📚 Implications for Investors & Researchers

For researchers, incorporating Amihud's liquidity measure enhances the understanding of return volatility beyond just market risk. For investors, understanding liquidity risk is crucial, especially when navigating periods of market turbulence or low trading volume, where price movements are more volatile.

03/01/2025

As we step into 2025, shifts in consumer behavior reflect growing awareness of societal and environmental impacts. 🎆 Many are opting out of purchasing fireworks, recognizing their effects on animals, communities, and the environment. But what does this mean for our economy and societal trends?

📉 Data Insights:

A study by the German Institute for Economic Research shows a 40% decrease in firework spending over the last five years, driven by over 60% of respondents citing animal welfare and environmental concerns.

In the Netherlands, cities like Amsterdam have reported an 18% reduction in emergency medical costs on New Year’s Eve following firework bans in residential areas.

Market research indicates that alternative celebration products, such as eco-friendly light shows, grew by 25% in sales last year, signaling a shift in consumer demand.

🔍 Economic Background & Implications:

Market Dynamics: The decline in traditional firework sales affects related industries, such as manufacturing and retail, while simultaneously creating opportunities in tech-driven alternatives like drone shows and LED displays.

Behavioral Economics: Research highlights how social norms and "nudge policies," such as public awareness campaigns, influence consumer choices. However, economists warn of "virtue signaling" where choices are made for public approval rather than genuine commitment.

Policy Impacts: Cities with firework restrictions have seen significant cost savings in public healthcare and cleanup efforts, redirecting resources to long-term community benefits.

💡 From Virtue Signaling to Real Change:

While it’s encouraging to see more people aligning actions with values, meaningful change requires consistency and depth—not just jumping on a bandwagon. Let’s foster habits that genuinely prioritize societal well-being and encourage innovative, sustainable economic alternatives.

What are your thoughts on the economic and social implications of these shifts? 🌟

03/01/2025

New year #2025 and we're back with

📊 Impact of Big 4 Firms on the Romanian Audit Market Post-IFRS Adoption 📊

At CEEJ, we are committed to conducting impactful research that sheds light on the intersection of financial reporting and market dynamics. One of the studies published a while ago focuses on the significant changes in Romania’s audit market following the mandatory adoption of International Financial Reporting Standards (IFRS) ‘Big 4’ influence on audit market

by Marta Tache https://sciendo.com/pl/article/10.2478/ceej-2020-0010

📝 Key Insights from the Study

This paper examines how the Big 4 audit firms have shaped the Romanian market after the implementation of IFRS, focusing on companies listed on the Bucharest Stock Exchange that traded premium shares between 2011 and 2019. Through extensive research and ANOVA analysis, we explore the factors influencing the choice of audit firms, including:

Profitability
Shareholders’ Funds
Firm Size
Size of Business Group

🔍 Findings

Our research confirms that the decision of choosing an audit firm is significantly influenced by the shareholders’ funds, number of employees, and business group size. The findings highlight a growing dominance of the Big 4, which has resulted in significant shifts within the audit market.

📉 Market Evolution

From 2011 to 2019, Romania's audit market underwent notable changes. These shifts have reshaped how businesses engage with audit firms, with the Big 4 firms solidifying their monopoly in this space.

🌍 Why This Matters

Understanding the impact of IFRS adoption on the audit market is crucial for businesses, regulators, and stakeholders. It’s essential for navigating the evolving dynamics of corporate governance and audit practices in Romania and beyond.

01/01/2025

✨ A “good jump” into 2025! (as the Germans say)

As we leap forward into a year of unprecedented innovation, we’re thrilled to spotlight the very last paper published in 2024 in the Central European Economic Journal. A fitting finale to a transformative year, this paper dives into the relationship between AI exposure and workers' wages across Europe.

The relationship between Artificial Intelligence (AI) exposure and returns to education

by Karol Madoń

Key insights include:

🔹 High-skilled workers reap the largest AI-related wage premiums.

🔹 Returns on AI-related skills are especially strong in Eastern Europe, highlighting regional differences.

🔹 Occupations with moderate to high AI exposure (6th–9th decile) benefit the most, while the least exposed see weaker effects.

The findings underscore how education and skills tailored to AI demands are critical for shaping future opportunities. As we embrace 2025, these insights offer a roadmap for navigating AI’s growing influence on work, wages, and regional labor markets.

📖 Don’t miss the chance to explore this groundbreaking study—the capstone to an incredible year of research. Here’s to an inspiring and innovative 2025, where we continue to unravel the intersections of AI, education, and equity!

🔗 Read more: https://sciendo.com/pl/article/10.2478/ceej-2024-0029

🎆 Let’s jump into 2025 together, ready to meet the challenges and opportunities ahead!

31/12/2024

🌟 Reflecting on a Remarkable Year at Central European Economic Journal – 2024 in Review! 🌟

As 2024 draws to a close, we are thrilled to celebrate a year of exceptional achievements at the Central European Economic Journal (CEEJ)! This year, we proudly published 24 outstanding papers, showcasing cutting-edge research and fostering critical discussions in economics.

📚 Highlights of 2024:

🚀 Thematic Collections: Curated selections that dive deep into timely economic challenges, providing fresh perspectives for our readers.

📰 Special Issue: Dedicated to celeberate 70th Birthday of Professor Jak Jakub Michałek , drawing significant attention and engagement.

👏 and then - Welcoming Professor Jan Jakub Michałek as our new Editor-in-Chief! With his leadership, we’re poised to expand CEEJ’s impact and outreach.

✨ Looking Ahead:

2024 was a foundation for even bigger aspirations. We’re committed to:

Enhancing our journal's global visibility and impact factor.

Attracting a broader community of authors and readers.

Exploring new formats and initiatives to further enrich the academic discourse.

🙏 A heartfelt THANK YOU to our dedicated reviewers, associate editors, and contributors. Your expertise, time, and passion are the backbone of our success.

Here’s to continued collaboration and innovation in 2025! 🚀

https://ceej.wne.uw.edu.pl/

30/12/2024

🎉 Last Episode of the Series: Wrapping Up the Year with Z as ... the Altman Z-Score 📊

As the year comes to an end, we’re excited to present the final episode of our Monday Alphabet Series, where we’ve been introducing key economic terms all year long. To close out the series, let’s dive into a crucial financial tool: the Altman Z-Score.

The Altman Z-Score is a statistical model developed by Professor Edward Altman in the 1960s to predict a company's likelihood of bankruptcy. By combining key financial ratios, the Z-score gives an overall score that helps investors, analysts, and financial professionals assess a company's stability and financial health.

🧮 How It Works:

The Z-score formula integrates five financial ratios, including:

Working Capital/Total Assets – Measures liquidity.

Retained Earnings/Total Assets – Indicates profitability and longevity.

Earnings Before Interest and Taxes (EBIT)/Total Assets – Measures productivity.

Market Value of Equity/Total Liabilities – Reflects market perception.

Sales/Total Assets – Demonstrates asset efficiency.

A Z-score of 3 or higher signals a low risk of bankruptcy, while a score below 1.8 suggests high risk. Scores between 1.8 and 3 fall into a "grey area," indicating moderate risk.

🔍 Why It Matters:

In the world of financial analysis, the Altman Z-Score is considered a reliable early warning system. It helps investors and stakeholders identify potential problems before they become critical, enabling proactive decisions to avoid financial loss.

With its roots in rigorous research, the Z-score has stood the test of time—proving to be a useful tool not just for individual companies but also in evaluating broader market health.

💡 Key Takeaway:

For anyone involved in finance or investment, understanding the Altman Z-Score is essential for assessing the financial health of companies and making more informed decisions.

Thank you for joining us in this year-long journey through key economic terms. We look forward to bringing you even more insights in the year ahead!

See more in research paper Liquidity and solvency of a company and the rate of return – an analysis of the Warsaw Stock Exchange

by Justyna Zalewska and Natalia Nehrebecka https://sciendo.com/pl/article/10.2478/ceej-2019-0013

Central European Economic Journal

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